Tesla Inc. TSLA shares have come under significant selling pressure since peaking at $414.50 in November 2021. After ending 2022 as the worst-performing mega-cap stock, it has come under further selling in the new year.
What Happened: Amid the development, calls for a revamp of the company’s board of directors are growing louder.
Leo KoGuan, who claims to be Tesla’s third-biggest individual shareholder after Elon Musk and Oracle co-founder Larry Ellison, tweeted last week that he is invested in the electric vehicle maker because he believes in Musk and the company.
See Also: How Did Elon Musk Make His Money
“But he is killing SH [shareholders] and Tesla. If I knew I wouldn’t invest in Tesla,” KoGuan added. He also went on to say that he has invested over $3 billion, but has “no choice to act and speak out.”
To a question on whether he as the third-largest shareholder has taken efforts to address the situation and has had talks with Musk, KoGuan said he has no say and raised some hard-hitting questions.
“Is Tesla the ONE’s private company masquerading as a public company?”, Is the one the sole CEO, BOD, CFO of Tesla?”, “Where is SEC?” were some of the questions KoGuan asked.
He also said he contacted the board and Musk for about a year and got nothing or at best empty promises. From the interactions, KoGuan said, it was evident that Tesla is a “one-man show company.” He added that it was no longer a family business but a public company with more than 100,000 employees.
In another tweet, he said, “He is running away with another seductive beauty that seduces the world with her power,” apparently referring to Musk.
“Power corrupts, absolute power corrupts absolutely..,” KoGuan added.
KoGuan Has Valid Points, Says This Analyst: The number three individual shareholder makes some valid points,” said Future Fund’s Gary Black. That said, no big institutional shareholders would want Musk to step down as CEO, Black said, and added that the need of the hour was choosing a new highly credible Twitter CEO.
Gerber Chimes In: Fund manager Ross Gerber called for a change in Tesla’s board. “It’s time for change with the Tesla BOD. They could have done a much better job protecting shareholders,” he said. Tesla has the fastest earnings per share growth of any large-cap tech but traded at a sad multiple," he noted.
Gerber, who had sounded out in the past his willingness to take board membership, said he would have the media situation and communication in shape in no time and Tesla would be unstoppable.
Tesla’s board currently comprises Chairman Robyn Denholm and Ira Ehrenpreis, James Murdoch, Kathleen Wilson-Thompson and Hiromichi Mizuno as independent directors. Musk, the company’s CEO with the designation of Technoking of Tesla, is part of the board. His brother Kimbal and Airbnb co-founder Joseph Gebbia serve as directors of the board.
Price Action: Tesla closed Friday’s session 2.47% higher, at $113.06, according to Benzinga Pro data.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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