When Tesla first announced that it submitted an acquisition offer to SolarCity‘s board of director, the company made it clear that Elon Musk and Antonio Gracias will recuse themselves from voting on the $2.8 billion merger deal since they both sit on the boards of both companies.
Now we learn that two more SolarCity board members will be recusing themselves from the vote after it was determined that they didn’t “meet the requirements for independence”.
The two SolarCity directors are JB Straubel, best known for being co-founder and CTO of Tesla, and Peter Rive, SolarCity co-founder and CTO, but also cousin to Elon Musk.
SolarCity’s VP of communications, Jonathan Bass, confirmed the news to Reuters:
“We’re very mindful of the need to have a process that ensures independent, objective decisions that are in the best interest of all shareholders. Only board members who meet the requirements for independence will be involved in the decision-making process at SolarCity.”
It leaves only 3 SolarCity board members to vote on the offer: John Fisher, Nancy Pfund and Donald Kendall Jr.
John Fisher is a partner at Draper Fisher Jurvetson, a venture capitalist firm which has investments in Tesla, SolarCity and SpaceX. Steve Jurvetson, another partner at the firm, is on the board of directors of both Tesla and SpaceX. In other words, the firm invested in all of Elon Musk’s ventures.
Nancy Pfund is one of two managing partners at DBL Partners, another venture capitalist firm, which just like Draper Fisher Jurvertson, invested in all three of Musk’s companies. Ira Ehrenpreis, the other DBL managing partner, is a board member at Tesla.
The third remaining board member is Donald Kendall Jr., CEO of Kenmont, an investment management firm. He doesn’t appear to have other connections to Tesla or SolarCity other than through his company’s investment in the solar installer.
Regardless of who on SolarCity’s or Tesla’s boards will get to vote, it looks like there will not be any surprise anyway. During a conference call with analysts earlier this week, Elon Musk described the board’s view on the offer as “unanimous” at both Tesla and SolarCity, but aside from the boards, shareholders of both companies will also have to vote on the offer.
We reported on shareholders sentiment in our piece: Tesla’s SolarCity deal gets support from shareholders and hate from people who don’t own the stock