TSLA Tesla Inc

Elon Musk proposed combining his electric-car and solar-energy companies, in a bold effort to consolidate his holdings and offer widespread clean-energy products from vehicles to power in homes.

Tesla Motors Inc., Mr. Musk's Palo Alto, Calif., electric-car company, on Tuesday offered to acquire SolarCity Corp. in a stock deal valuing it at up to $2.8 billion. Mr. Musk is the chairman and largest shareholder of both companies.

Tesla in a letter to SolarCity's chief executive said its offer represented a value of $26.50 to $28.50 a share, or a premium of roughly 21% to 30% over SolarCity's Tuesday closing price of $21.19.

Mr. Musk, who has garnered attention for unusual financial maneuvers to support his companies, recused himself from voting on the deal at the Tesla board meeting at which it was approved and will do so for any vote on the SolarCity board as well, the letter said. Antonio Gracias, a director on the boards of both companies, also recused himself, the letter said.

SolarCity shares surged 24% in after hours trading, while Tesla shares fell 6.7%.

Write to Mike Ramsey at michael.ramsey@wsj.com

(END) Dow Jones Newswires

June 21, 2016 18:05 ET (22:05 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.