Citigroup has cited Tesla and a number of other large companies as potential takeover targets for Apple.
The technology giant currently has more than $250 billion in cash waiting to be put to work and in a note to clients, Citigroup analyst Jim Suva said Tesla, Netflix or Walt Disney are all possible targets for Apple, Reuters reports.
As is stands, over 90 per cent of Apple’s money is overseas but under new proposals from President Trump, mutlinationals could bring overseas profit into the U.S. at a 10 per cent tax rate compared to the current 35 per cent rate. Apple could therefore bring about $220 billion to the U.S. and use it in a huge takeover.
“Since one of the new administration’s top priorities is to allow US companies to repatriate overseas cash at a lower tax rate, Apple may have a more acute need to put this cash to use,” Suva said.
While Apple could easily takeover Tesla with its $51 billion market cap, it’s unlikely to happen. A few years ago, there was similar talk of an Apple takeover but it failed to eventuate. Considering that Tesla chief executive Elon Musk believes his company can exceed Apple’s $750 billion valuation within a decade, it is hard to believe he will relinquish control of the electric automaker.
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