The deal is controversial and critics assert it amounts to a bailout for SolarCity. Both companies have posted financial losses since going public and are suffering from a cash squeeze.

Tesla chief executive Elon Musk is also chairman of SolarCity, where his cousins Lyndon and Peter Rive are chief executive and head of technology, respectively. Musk is the largest shareholder of both companies, and will not vote on the offer.

Musk