Apple Potentially Targeting Tesla for Takeover, Says Citi Analyst
The deep-pocketed tech giant could have several companies in its sights; Tesla might be one.
Could Apple be gunning for an acquisition or merger with Tesla? A Citigroup analyst believes it's a possibility—especially with Apple's huge cash reserve that has recently surpassed a quarter of a trillion dollars. With big things on the horizon for Tesla Motors, and cash burning a hole in Apple’s pocket, it’s an angle to consider.
It's fair to say that Tesla wasn't the only company to appear in this forecast, made by Citigroup analyst Jim Suva. Netflix and Disney are two other big names tossed around in addition to the automaker. But Apple is currently working on a self-driving vehicle program of its own, and was granted a permit for autonomous vehicle testing in California. The company's test vehicles also been spotted testing the tech on-road.
Acquisitions are no surprise for tech companies. It is relatively commonplace for some large organization to be late to party when it comes to new technology. When this happens, the easiest and quickest, though not always the most affordable, entry to the market is to buy out a competitor. Could this potentially be what Apple is up to?
Apple has no shortage of money. The tech giant has more on hand cash than the entire GDP of Chile, Finland, or Greece. Their off-shore bank account numbers are swelling to the tune of $256.8 billion, up $10 billion from last quarter, and $8 billion from the previous. That is a ton of money. Quite literally, as that amount of cash in $100 bills weighs just over 2,231 tons.
Recently, Tesla CEO Elon Musk had met with Apple's head of mergers and acquisitions – much as he has done numerous time before. On a phone call with Bloomberg, Musk declined to speak about if he had had acquisition talks with “one or more companies” over the past year. When asked if Tesla was for sale, Musk responded with “I think that’s very unlikely”.
I’d be very concerned that we’d become distracted from […] the driving goal of Tesla
Elon Musk, CEO Tesla Motors
Musk does mention that if there were a scenario where it would be more likely to create a mass-market affordable car, it would make sense to consider the possibility of selling out. However, at this time, h doesn’t currently see such a scenario. This doesn't mean that the sale isn't an eventuality, just not necessarily a "right now" decision, at least according to Musk. At least we can agree that Musk has his company in mind, and not just the bottom line of his bank account.
MORE TO READ
Elon Musk Says He Has No Idea What Apple’s Car Project Is Up To
The Tesla CEO said “it’s not clear” what exactly Apple is working on when it comes to its automotive plans.
Apple, Tesla Weigh In on California Self-Driving Car Regulations
Both Apple and Tesla want to make changes to proposed California self-driving car rules.
Apple Hires Former Tesla & NASA Staffers in Driverless Car Push
The secret team was accidentally revealed in a DMV paperwork error.
Apple Will Test Driverless Car With Steering Wheel and Pedals
This comes after Apple received a permit to conduct testing in California.