Tesla Shareholder Vote: Musk Receives Backing From 10th Biggest Investor For Pay Plan — Will Others Follow?
Benzinga
Published Apr 19, 2024 13:48
Updated Apr 19, 2024 15:10
Tesla Shareholder Vote: Musk Receives Backing From 10th Biggest Investor For Pay Plan — Will Others Follow?
Benzinga - by Anan Ashraf, Benzinga Editor.
Despite a Delaware judge voiding Elon Musk‘s record-breaking 2018 pay package in January, citing unfairness to investors, Tesla, Inc. (NASDAQ:TSLA) has secured a critical supporter for its reinstatement: T. Rowe Price, the company’s tenth-largest shareholder.
What Happened: This backing from a major investor, as reported by Reuters, adds a significant layer of intrigue to the upcoming special vote at Tesla’s June 13 annual shareholder meeting. The vote seeks re-approval of the 2018 compensation plan, which the court deemed unfair due to the board’s negotiation process.
T. Rowe Price stands in stark contrast to the court’s decision. In a statement, the investment firm underscored its belief that the 2018 plan aligned with the interests of long-term investors. They further emphasized Musk’s success in fulfilling the ambitious goals outlined in the original agreement.
Why It Matters: This position by T. Rowe is noteworthy considering their significant stake in Tesla.
With 22.4 million shares held as of Dec. 31, their vote carries substantial weight. Their support suggests confidence in Musk’s leadership and the long-term value-creation potential tied to the performance-based pay package.
While Tesla argues the court’s decision left Musk uncompensated for the past six years, and the board chair echoed concerns about fairness, the focus now shifts to the broader investor base.
Check out more of Benzinga's Future Of Mobility coverage by following this link.
Read More: Tesla Recalls Over 3,800 Cybertrucks, Cites Unintended Acceleration Risk
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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