Elon Musk has converted the general meeting of shareholders of teslawhich is held on Thursday, in a referendum on him by including in the meeting the vote on two controversial proposals: the approval of its historic compensation valued at around $50 billion and the transfer of the company’s registration to Texas.
Tesla and Musk have mounted an intense public relations campaign to try to convince shareholders that the controversial businessman deserves the compensation package, composed of stock options, agreed in 2018 and which a US court annulled in February.
On Tuesday, two days before the start of the meeting, Tesla published a lengthy message on the social network X (owned by Musk) in which he listed what the company had achieved since 2018.
The message was repeated by Musk himself on his social network account, where he is also posting similar notes of support from other X users.
Musk has been embarking on an offensive for weeks to try to convince the company’s small investors to vote in favor of the payment.
The businessman revealed over the weekend that 90% of the individual shareholders who have already voted have approved the agreement, although he did not indicate how many have already cast their ballots.
Analysts consider it normal for small investors to align with the company’s position, especially when The share value has increased by 770% since 2018.
But they also warn that individual shareholders do not participate in large numbers in voting, so it is the large shareholders who ultimately settle the issues presented before the general meetings.
And, for now, Musk and Tesla face a widespread ‘no’ from institutional investors.
Musk seeks a payment of US$50 billion
The country’s two largest public investment funds, California Public Employees’ Retirement System (CalPERS) and California State Teachers Retirement System (CalSTRS), which combined control more than 5 million shares of Tesla, They have expressed their rejection of the payment of $50 billion to Musk.
CalSTRS Chief Investment Officer Chris Ailman called the package “ridiculous” and although he acknowledged that Musk has multiplied the value of the company with his management and “needs to have a good salary,” he proposed limiting it to “140 times the average salary of a worker.”
“I think it’s fair,” he said.
The 2018 agreement established the payment of the multimillion-dollar compensation if the company achieved 12 objectivesincluding a market capitalization of at least $500 billion and certain revenues.
Norway’s sovereign wealth fund, which has almost 1% of the shares, has also expressed its opposition, and two of the main US advisory services agencies, Institutional Shareholder Services (ISS) and Glass Lewis, have advised investors. shareholders to lower the payment.
Most institutional shareholders also oppose transferring Tesla’s registration from the state of Delaware to Texas, as Musk wants.
The transfer is linked to the payment of the multimillion-dollar compensation.
When Delaware Judge Kathaleen McCormick ruled in February annulling Musk’s compensation package, considering, among other reasons, that the directors who approved it were not independent, The businessman reacted by attacking the state’s judicial system.
Musk turned to his loyalists at X, asking whether he should transfer Tesla’s registration to Texas, where the automaker is now headquartered. and where corporate control laws are more relaxed than in Delaware.
87.1% of voters, 1.1 million users according to X figures, approved the proposal, which was enough for the businessman to raise the issue with shareholders.
