Elon Musk Fears Ouster by Activist Shareholders, Seeks Greater Tesla Control

Elon Musk, CEO of Tesla, has once again voiced his concerns regarding his control over the electric vehicle and clean energy company. He fears that activist shareholders might attempt to oust him, potentially due to disagreements over his political views or wealth, rather than a shared vision for Tesla's future.

Musk's Desire for Control

Musk has stated that he desires approximately a 25% voting control in Tesla. This level of ownership, he believes, would be sufficient to remain influential and guide the company's direction, particularly in areas like AI and robotics, without being so dominant that he cannot be challenged or removed if his leadership falters.

• Musk's current stake is 12.8%, with options to increase it. Exercising these options, after taxes, would raise his voting control by about 4%.

• He has expressed a preference for building advanced technologies like humanoid robots outside of Tesla if his control is not secured.

Past Conflicts and Shareholder Votes

Musk's concerns are amplified by past events, including the Delaware Chancery Court's decision to deny him a lucrative 2018 compensation package, despite shareholders approving it twice. Judge Kathaleen McCormick famously described the package as an "unfathomable sum."

Current Financial Standing and Future Concerns

In a recent social media post, Musk clarified that he currently has no personal loans against his Tesla stock. He also reiterated his worries about being ousted by activist shareholders, especially after investing heavily in developing advanced technologies like humanoid robots. He fears that without sufficient control, his vision for Tesla could be derailed.

Potential Impact of Losing Control

There is a concern that if external forces, such as politicians or judges, continue to limit Musk's ownership stake, he might eventually divest from Tesla. The overwhelming majority of shareholders who voted to approve his compensation package still desire his leadership. Without his guidance, Tesla could undergo significant restructuring and a fundamental shift in its strategic direction.

Sources

• Elon Musk echoes worries over Tesla control against activist shareholders, Teslarati.