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Tesla (TSLA) gets vote of confidence from one of its top investors at Fidelity

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Fidelity’s OTC Portfolio is one of Tesla’s (TSLA) top mutual fund investors, second only to Fidelity’s Contrafund, with 3.14 million shares as of the end of last quarter. Gavin Baker, the fund’s portfolio manager, commented about Tesla in his letter to fund shareholders and gave the company his vote of confidence.

Baker said that they “modestly increased” their position in Tesla and wrote yesterday (via Reuters):

“We are fans not just of Tesla products but of the concepts underpinning the firm and potential future partnerships ahead of it. We foresee fruitful synergies between Tesla and any company in search of superior battery technology, and we modestly increased our position this quarter.”

The news comes as Tesla and SolarCity are reportedly close enough to vote on a merger agreement. Baker’s fund is also the largest mutual fund investor in SolarCity with about 9% of the shares.

Last week, Tesla CEO Elon Musk said that he is convinced the merger will pass after talking to the companies’ major investors. Baker must not have been too difficult to convince since he made similar comments earlier this year, before the proposed merger was even announced.

It’s not clear when the merger will be presented to shareholders for a vote, but Elon Musk called for bringing the two companies together again earlier this month in his ‘Master Plan Part Deux’:

“Create a smoothly integrated and beautiful solar-roof-with-battery product that just works, empowering the individual as their own utility, and then scale that throughout the world. One ordering experience, one installation, one service contact, one phone app.

We can’t do this well if Tesla and SolarCity are different companies, which is why we need to combine and break down the barriers inherent to being separate companies. That they are separate at all, despite similar origins and pursuit of the same overarching goal of sustainable energy, is largely an accident of history. Now that Tesla is ready to scale Powerwall and SolarCity is ready to provide highly differentiated solar, the time has come to bring them together.”


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