Tesla Motors seeks blessing for SolarCity deal

Tesla Motors shareholders will decide Thursday whether to authorize the company's acquisition of SolarCity in a vote that will test their commitment to CEO Elon Musk's grand vision for the company.

The Palo Alto, Calif.-based maker of electric vehicles and batteries is seeking to extend its footprint into solar panel installation and photovoltaic roofing with the SolarCity deal. Shareholders will cast ballots in a special meeting at 4 p.m. ET.

Critics say money-losing SolarCity is not a good fit for Tesla, which faces the costly burden of ramping up its engineering and manufacturing capacity to produce the mass-market Model 3 electric car in California and batteries in Nevada.

But Musk has thrown his considerable rhetorical weight behind the deal, giving many investors faith that the marriage will produce fruit.

Musk has argued that Tesla's overall vision is to sell sustainable energy products and that it can sell SolarCity services through its existing network of Tesla stores. He has also outlined a vision to integrate solar cells into Tesla rooftops, sell solar roofing for houses and shed overlapping expenses.

"This is an action now which is anticipating several moves ahead," Musk said in August.

The deal recently fetched the endorsement of Institutional Shareholder Services, an advisory firm whose recommendations are often followed by major shareholders in contentious votes.

Musk recused himself from negotiating the deal because he is the chairman and large shareholder of SolarCity.

He told CNBC earlier this month that he was surprised ISS backed the deal. "I thought they wouldn’t recommend it. But they did. And I’m very, very glad that they did," he said. "They can be a bit negative."

ISS said the deal is "a necessary step" in Tesla's "goal of being an integrated sustainable energy company."

Follow Paste BN reporter Nathan Bomey on Twitter @NathanBomey.