Tesla is teaming up with Panasonic to manufacture solar panels and modules.
The two companies have entered into a so-called, "non-binding letter of intent" under which they will collaborate on the production of photovoltaic (PV) cells, based at SolarCity's factory in Buffalo, New York.
This agreement, however, depends on shareholders approving Tesla’s acquisition of SolarCity.
Tesla, owned by Elon Musk, announced plans to buy SolarCity, also owned by Musk, in June. The deal was provisionally agreed in August after both boards of directors approved the deal. This was then subject to a 45-day period where other offers for SolarCity could be made by rivals.
The deal is expected to close in the fourth quarter of 2016, after shareholders have been given the chance to vote on the deal and approval has been sought from regulators. Tesla will use the cells and modules in a solar energy system that will work seamlessly with Powerwall and Powerpack, Tesla’s energy storage products.
If pushed through, the deal will see the electric car company complete an all-stock transaction with the equity value being $2.6 billion (£1.97bn). Panasonic will then begin producing PV cells and modules at the Buffalo facility in 2017. Tesla intends to provide a long-term purchase commitment for those cells from Panasonic.
The partnership builds on the current relationship between Tesla and Panasonic, which includes the production of electric vehicle and grid storage battery cells at Tesla's Gigafactory.
This article was originally published by WIRED UK
