Authorization

World's biggest investor in clash with Tesla over Elon Musk's dual role

Norway’s $1 trillion sovereign wealth fund wants to strip Elon Musk of his chairman role at Tesla, narrowing his responsibilities to only that of chief executive of the electric car company.
Norges Bank Investment Management (NBIM) - which has a 0.5pc stake in Tesla - said it backed a proposal put forward by a small shareholder to end Mr Musk’s dual roles.
Jing Zhao, who holds 12 shares in Tesla, argued for the job separation at Tesla’s annual meeting on Tuesday, saying it was impossible for the company’s billionaire founder to do both jobs “in this highly competitive and changing industry”.
NBIM - which holds a stake worth about $250m in Tesla and holds 1.4pc of all listed companies globally  - is a strong advocate of good corporate governance and its stance is highly influential.
However, the proposal was defeated by what Tesla described as a “wide majority”. The company’s structure requires two-thirds backing for a shake-up. Mr Musk holds more than 20pc of the shares, making upheavals unlikely. Tesla is due to release the full results of the vote in a regulatory filing in the next few days. 
World's biggest investor in clash with Tesla over Elon Musk's dual role

Tesla hopes to bring electric driving to the masses with its 'affordable' Model 3 car
As well as voting for the job split - which was also backed by powerful shareholder advisory groups ISS and Glass Lewis - NBIM also voted against the re-election as a director of Antonio Gracias, a venture capitalist who is Tesla’s lead outside director.
NBIM backed James Murdoch, chief executive of 20th Century Fox, and Kimbal Musk, the founder’s brother, who were also up for re-election.
Earlier this year NBIM voted against a knock-out new remuneration package for Mr Musk. Assuming the company does not issue any more shares or raise money, this deal which could earn him as much as $70bn if he hits a target of increasing the company’s value from the current $49bn to $650bn (?466bn) in a decade.
World's biggest investor in clash with Tesla over Elon Musk's dual role

James Murdoch faced election as a director of Tesla

Credit:
Bloomberg
The wealth fund was outvoted on the ambitious package, under which the billionaire will not receive any guaranteed pay of any kind: no salary, no cash payouts or shares that vest as time rolls on.
NBIM’s stance on director elections went against a move by CtW Investment Group, an adviser to pension funds controlled by unions, which wanted to see all three directors removed.
It argued that Kimbal and Mr Gracias were too close to Mr Musk, and that Mr Murdoch did not have any experience of the car industry.
CtW’s position could be related to Tesla’s union troubles. Workers at the company’s California plant are trying to unionise because of worker safety concerns.
World's biggest investor in clash with Tesla over Elon Musk's dual role

Unions have raised concerns about staff at Tesla

Credit:
Bloomberg
Mr Musk has hit back at the union, using tweets to say Tesla was doing nothing to stop staff becoming members, but asking “why pay unions dues and give up stock options for nothing?”
Production of the Model 3 car has proved a massive problem for Tesla. The vehicle, which is intended to bring electric motoring to the masses at an affordable price, has suffered manufacturing issues which have slowed output.
Mr Musk told the the annual meeting that Tesla is now able to build 3,500 Model 3 cars a week - a rise of 1,500 on last month - and was optimistic 5,000 a week could be hit in June.
World's biggest investor in clash with Tesla over Elon Musk's dual role

Tesla's Model 3 has faced production bottlenecks

Credit:
Tesla
At this level the company would become profitable, Mr Musk said, adding that he did not expect Tesla would have to seek additional financing.
Analysts have speculated the company is burning through cash at such a rate that it will have to go to investors for more money because it cannot build Model 3 cars quickly enough.
cars Tesla Model 3 explainer puff
In April Goldman Sachs advised investors to sell Tesla shares, predicting it would need to go to the market for more funding “for capacity and product expansion”.
See also:
Leave a comment
News
  • Latest
  • Read
  • Commented
Calendar Content
«    Декабрь 2018    »
ПнВтСрЧтПтСбВс
 12
3456789
10111213141516
17181920212223
24252627282930
31