Investors questioned a plan by Silicon Valley heavyweight Elon Musk for his electric car company Tesla Motors to buy his rooftop solar company SolarCity for up to $2.8 billion, sending Tesla's shares down more than 10 percent on concerns the two would not fit together and a deal would distract Tesla from making cars.

However, there were signs that some of the biggest funds holding shares of both companies might be open to a deal.

Musk, an audacious entrepreneur who is the chairman of SolarCity Corp (SCTY.O), chief executive of Tesla Motors Inc (TSLA.O) and the largest shareholder of both companies, envisions a one-stop shop for clean-energy fans, who would be able to buy an electric car, home solar system and battery backup in a single visit.

But many investors and analysts focused on practical concerns of the plan and whether Musk was giving himself a good deal.

Musk, who is also the CEO of rocket-maker SpaceX, and Tesla management risked being distracted from rolling out the new Model 3 sedan, a mass-market electric vehicle key to the success of the young firm, analysts said, questioning whether merging two companies which both need substantial cash was a good idea.