Tesla: Elon Musk ensures that his mega remuneration is validated

Tesla: Elon Musk ensures that his mega remuneration is validated
Tesla: Elon Musk ensures that his mega remuneration is validated

Elon Musk says his mega pay is validated

Published today at 10:14 a.m.

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Tesla CEO Elon Musk claimed that the group’s shareholders had approved his mega remuneration “by a large majority”, in a message published on his social network X, before the conclusion of the vote.

“Both Tesla shareholder resolutions are currently adopted by a large majority!” Mr. Musk wrote late Wednesday evening in the United States, referring to the resolutions aimed at approving his compensation plan worth 56 billion dollars and the transfer of Tesla’s registration from Delaware (east) to Texas (south).

Official voting results have not yet been released.

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The car manufacturer campaigned in all directions until the last moment for its shareholders to adopt its boss’s enormous remuneration plan.

“Time is running out,” posted Wednesday afternoon the votetesla.com site created for the occasion, while a countdown ticked off the seconds until 11:59 p.m. in Texas (04:49 GMT), the closing time of the vote.

Worthy of an election campaign

“Your vote is crucial for the future growth and success of Tesla and for the value of your investment,” insisted the electric vehicle specialist in a video explaining, with the help of his humanoid robot Optimus, how to vote.

To encourage votes, the group put into play, by drawing lots, fifteen visits to the mega-factory in Austin (Texas) with Elon Musk and Franz von Holzhausen, chief designer of Tesla, as guides.

In addition to the dedicated site and Optimus’ help, numerous messages have been published on X, as well as advertisements on the internet. Worthy of an electoral campaign.

The group is counting on small investors to make the difference against large investors, several of whom have announced in recent days that they are opposed to the remuneration package.

These institutional investors did the same on March 21, 2018, when this financial package was submitted to shareholders at an extraordinary general meeting. The “yes” vote won by 73%, excluding the votes of Elon Musk and his brother Kimbal.

The package was estimated at $56 billion and provided for stock distributions for ten years, based on specific objectives.

Appeal in January

But a shareholder’s appeal before a Delaware court resulted in its annulment by a judge at the end of January.

In mid-April, the board of directors undertook a maneuver to get it back on track by including it on the menu for Thursday’s ordinary general meeting.

“The board supports this compensation plan. We believed in it in 2018, asking Elon to pursue remarkable objectives to develop the company,” the board argued at the time.

Tesla shares were worth $20.70 at Wall Street’s close the day before the 2018 AGM, and $177.29 at close on Wednesday.

According to the Wall Street Journal, the “yes” and “no” votes were neck and neck on Tuesday.

“We think investors will need to buckle up ahead of what should be a volatile week for their stocks,” warned Garrett Nelson, analyst at CFRA Research.

According to him, individual shareholders hold around 40% of the manufacturer’s capital.

The fear, he underlined like other experts and shareholders favorable to the plan, is that, in the event of refusal by the AG, the billionaire will turn away from Tesla to devote himself more to his other companies (SpaceX, X, xAI, Starlink, etc.).

However, for many, Tesla is nothing without Elon Musk.

“This compensation plan is ridiculous”

Tesla represents the largest asset in its portfolio (around $3 billion as of March 31) but it remains a little behind Vanguard, the leading investor with a share of 7.23% at the end of 2023.

Asked by AFP, the latter refused to reveal his vote and BlackRock, second investor with 5.9%, did not respond.

According to the Wall Street Journal, in 2018 the first voted against, while the second approved the plan.

The California Teachers’ Pension Fund (CalSTRS), one of the three largest in the United States, has decided: no.

“This compensation plan is ridiculous,” said Chris Ailman, its investment director, on CNBC, emphasizing that it amounted to paying Elon Musk “140 times the average employee’s salary.”

Same refusal from the Norwegian sovereign fund NBIM – the largest in the world and shareholder of Tesla with 0.98% at the end of 2023 – as in 2018.

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