Tag: Elon Musk

Experts say Tesla board may have too many ties to CEO Musk

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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For years, Tesla’s board remained almost invisible, staying behind the curtain as superstar Chairman and CEO Elon Musk guided the electric car maker to huge stock price increases. Now, given Musk’s recent questionable behavior, experts say it’s time for the board to step onstage and take action on the company’s leadership.

The list of Musk’s offenses include berating Wall Street analysts on a conference call and labeling as a pedophile via Twitter a British diver involved in the cave rescue of trapped Thai soccer players.

Add to that his abrupt Twitter announcement of a plan to take the company private even though funding hasn’t been solidified, as well as confessing to being overwhelmed with job stress in a recent interview, and it’s likely that most other company boards in a similar position would have taken action, corporate governance experts say.

Yet Tesla’s nine-member board, which includes Musk and his brother, Kimbal, has largely been silent, save for forming a three-member committee to decide on the go-private plan that has already drawn scrutiny from US securities regulators.

At least five of the company’s eight non-executive directors have strong ties to Musk or one of his other companies, throwing their independence into question.

“I believe Elon Musk is a genius and he needs to be admired and encouraged, but this board of directors has to do more management oversight of the company. The board of directors is not meant to be a cheering committee,” said William Klepper, a professor at Columbia Business School and an expert on corporate governance issues.

Kimbal Musk is among the five directors with ties to Musk. Lead director Antonio Gracias founded a private equity firm and also is a director of SpaceX, Musk’s privately held rocket company. Director Steve Jurvetson is also a SpaceX director. He’s been on leave from his venture capital firm since allegations of sexual misconduct appeared last year.

Another director, venture capitalist Ira Ehrenpreis, is also a SpaceX investor, while director Brad Buss is a former chief financial officer of SolarCity, a solar panel maker that Tesla acquired in 2016.

Australian telecommunications company executive Robyn Denholm was the only other Tesla director until last year, when two were added after investors complained about a lack of independence. James Murdoch, the CEO of 21st Century Fox, and Linda Johnson Rice, the chairman and CEO of Johnson Publishing Co., joined the board in July of 2017.

In a 2017 letter seeking two more board members, five investors wrote that five Tesla directors “have professional or personal ties to Mr. Musk that could put at risk their ability to exercise independent judgment.”

One of the five, New York City Comptroller Scott Stringer, who manages investments in Tesla, said in a statement Monday that it’s time for the board “to take a hard look at Tesla’s governance and compensation structures to ensure that there are proper processes in place for strong board independence and oversight.”

Columbia’s Klepper said Tesla didn’t need more board members; it needed assertive ones. “They need to make some hard choices about the existing board members and decide whether their expertise really fits with Tesla’s mission,” Klepper said.

Two major firms that specialize in corporate governance issues advised Tesla shareholders to shake up the company’s board earlier this year, citing troubling conflicts of interest and decisions that raised questions about the directors’ links with Musk.

Shareholders wound up rejecting the recommendations of Institutional Shareholder Services and Glass Lewis & Co. at Tesla’s annual meeting in June and re-elected all three directors — Gracias, Murdoch and Kimbal Musk — whose terms were expiring.

Glass Lewis recommended voting against the three; ISS opposed the re-elections of Gracias and Murdoch, but concluded there was no reason to oust Kimbal Musk because he doesn’t serve on any board committees requiring independence from his brother.

Tesla wouldn’t comment about its directors, and members reached Monday did not return messages. But the company pointed to its proxy statement that said seven of nine members are considered independent based on standards set by the Nasdaq stock market, on which Tesla stock trades. The company said Ehrenpreis and Gracias do not own stakes in Tesla.

Tesla’s stock has been on a roller-coaster since Musk used Twitter on Aug. 7 to say he was considering taking the publicly traded company private. Even though Musk said funding had been secured for what could be at least a $20 billion deal, the company later disclosed that it wasn’t. On the day of the announcement, shares rose 11 percent but since have fallen almost 19 percent, closing Monday at $308.44.

Musk disclosed that he tweeted out the proposal while driving himself to the airport — without anyone else seeing or reviewing the post. He wrote later that he notified the board on Aug. 2 and that the board met twice before the announcement.

Experts say under more normal circumstances, the board committee would have evaluated the plan before it was made public, a sign that Tesla’s directors aren’t taking an active role in running the company.

Tesla, which began selling stock to the public in 2010, has a governance structure that more resembles a startup than a company with $11.76 billion in revenue and sales of 101,000 vehicles last year, experts say.

Musk is chairman, CEO and “product architect,” and the company has no chief operating officer, a position that would typically exist to run the day-to-day operations and allow the CEO to focus on bigger picture ideas. In contrast, at Silicon Valley titan Apple Inc., Steve Jobs held a CEO title and was deeply involved in product development while he was alive, but left the day-to-day operations of the company to Tim Cook, then the company’s COO.

Tesla’s problems are compounded by the fact Musk splits his time as head of Tesla and at least three other ventures.

“Musk cannot be all things at all time,” Klepper said.

Charles Elson, director of the corporate governance center at the University of Delaware, said the board has a duty to evaluate whether Musk can lead the company given his confession last week to The New York Times that the job was taking a toll on his personal health.

“It paints a picture of someone who is deeply troubled,” Elson said. “Running a business is difficult enough. Finding yourself in that state of mind is something different.”

With a normal board and normal corporate governance, Musk would have been gone already, Elson said.

“People have been moved on for a lot less,” he said.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla shares head for 3-month low as deal doubts grow

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Tesla Inc shares fell 7 percent early on Monday as a $113 cut in JPMorgan Chase’s price target for the electric carmaker added to growing doubts among market players about a plan to take the company private.

Slashing its price target for Tesla Inc from $308 to $195, the brokerage said it did not believe Chief Executive Officer Elon Musk had the funding for a plan announced by tweet just under two weeks ago.

Analysts from the US bank had upped its forecast from $198 to $308 after a surge in Tesla stock following Musk’s tweets on Aug. 7 but its analysts said they now thought the deal was a long way from completion.

It now targets the stock, which it continues to value at underweight, back at $195, versus Friday’s close of $305.50. The median price target of the Wall Street analysts covering Tesla is $336.

“Our interpretation of subsequent events leads us to believe that funding was not secured for a going private transaction, nor was there any formal proposal,” analyst Ryan Brinkman wrote in a client note.

“Tesla does appear to be exploring a going private transaction, but we now believe that such a process appears much less developed than we had earlier presumed, suggesting formal incorporation into our valuation analysis seems premature at this time,” Brinkman said.

At $286 in premarket trading on Monday, Tesla was set to open at its lowest since the start of June.

Tesla stock fell nearly 9 percent on Friday after Musk gave an hour-long emotional interview to the New York Times saying he was under major emotional stress and “this past year has been the most difficult and painful year of my career. It was excruciating.”

People familiar with the matter said on Sunday that PIF, the Saudi Arabian sovereign wealth fund that Musk has said could help find the billions of dollars needed for the buyout, is in talks to invest in aspiring Tesla rival Lucid Motors Inc.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

What Elon Musk could learn from Jeff Bezos and Warren Buffett

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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To reach production targets for his electric car company Tesla, Elon Muskhas said he’s worked up to 120 hours a week. At times, he ignores emails and phone calls, has barely had time to shower and has been known to sleep on his factory floor. He’s called this year both “excruciating” and “difficult.”

In response, Tesla executives have reportedly amped up their search for a No. 2 person who can relieve some of Musk’s day-to-day responsibilities — a claim the CEO disputes. Musk, though chronically exhausted, said in an emotional Thursday interview with the New York Times he doesn’t plan on renouncing his roles as chairman and chief executive.

Musk’s situation could highlight a classic problem facing many leaders: Reluctance to delegate. At best, that reluctance can lead to long nights and lost time. At worst, it can lead to a ‘one-man show’ management style experts say slows growth and keeps leaders from thinking about the big picture.

Leaders struggle with delegation for multiple reasons. Some are just perfectionists, says Carol Walker, the president of consulting firm Prepared to Lead, in a recent Harvard Business Review article. Leaders might also see their work as better or believe that relinquishing control will somehow detract from their own importance.

Founders like Elon Musk understandably feel a special sort of responsibility, says Peter Harms, a professor of management at the University of Alabama. He says entrepreneurs like Musk could feel indispensable because they often are one of the few in their business who do understand its intricacies. They can struggle the most with giving up power, since their company is like their baby and, says Harms, “you wouldn’t give your child to a stranger.”

Other leaders might simply lack confidence. Ironically, experts say that delegation of responsibility and not just tasks is a sign of a truly confident leader. “Giving up being ‘the go-to expert’ takes tremendous confidence and perspective even in the healthiest environments,” Walker says in Harvard Business Review. “It’s even more challenging in the average company, where being a good manager is seen as a ‘nice to have,’ but where producing the core deliverable is what is truly esteemed.”

Musk, who runs both SpaceX and Tesla, might do well by studying examples set by Jeff Bezos and Warren Buffett. Buffet has CEOs in place for companies in his Berkshire Hathaway portfolio, and serves as “as a kind of manager of managers,” Barron’s pointed out in a recent article. Buffett reportedly employs a hands-off approach with his managers, giving them a sense of autonomy while making them feel trusted.

Bezos, Amazon’s CEO, delegates authority to chief execs for companies such as Blue Origin and his venture capital firm Bezos Expeditions.

Helping Bezos delegate further is his approach to decision-making. There are just two different types of decisions, Bezos explained in a 2015 letter to shareholders: Type 1 decisions, that are strategic and mission critical, and Type 2 decisions that can be changed and re-evaluated. Bezos ensures wider teams take on Type 2s, while only high-level execs worry about Type 1 matters.

Bezos has said that he aims for getting 70 percent of the information he needs for decisions, making modifications from there. “If you’re good at course correcting, being wrong may be less costly than you think, whereas being slow is going to be expensive for sure,” wrote Bezos in a 2016 shareholder letter.

Sticking with the big picture is a better fit for most founders, says Harms. Most “are visionaries, and it’s hard for them to deal with day-to-day menial tasks.”

Management experts point to certain classic signs a leader is struggling with delegation. These signs include working long hours and feeling completely indispensable while their staff is working a classic 9 to 5, says Walker.

Leaders who relate to Musk and his long hours might start by following the 90/10 decision-making rule, according to Jennifer Dulski, head of groups and community at Facebook and author of business book “Purposeful.” This rule stipulates that managers should only make 10 percent of the company’s decisions, specifically those that require executive approval. The remaining 90 percent are handled by employees.

This shift can be a hard one for leaders used to taking everything on, but it’s a necessary one for companies looking for fast, efficient growth. “When you give your team the space they need, they find creative ways of reaching their goals,” Dulski writes in a separate LinkedIn post. “If your vision and objectives are clear to them, and there are accountability measures in place, it can open up new approaches and new solutions to your business goals.”

Such change isn’t easy, however. These types of leaders could feel attacked, says Harms, and might only listen to suggestions for change if they trust the person giving them the feedback and believe in that person’s sincerity.

Unfortunately, says Harms, Musk might not have such a person at his side.

“Steve Jobs had Tim Cook,” says Harms. “It doesn’t seem like Elon Musk has anyone.”

Source: Make It, CNBC.com

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Elon Musk says cutting back on work hours isn’t an option

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Arianna Huffington is calling on Elon Musk to adopt a healthier work-life balance, but the Tesla CEO says that’s not an option.

In a tweet early Sunday after arriving home from a late night at a Tesla factory, Musk told the Huffington Post founder that his electric car company and Ford are the only two American automakers that have avoided bankruptcy.

He then added, in an apparent reference to his long hours at work: “You think this is an option. It is not.”

Musk was responding to an open letter from Huffington on Friday in which she called on him to change the way he works so he can ensure he’s taking more time to “refuel and recharge.”

Musk conceded in a wide-ranging interview with The New York Times last week that he’s overwhelmed by job stress, has been working up to 120 hours a week and sometimes takes Ambien to get to sleep.

Tesla has presented plenty of challenges for Musk. The company routinely loses money and is burning through cash as it ramps up development of its Model 3 sedan, a less-expensive electric car it hopes appeals to the mass market. A large number of investors known as short-sellers have bet against the company.

Musk, who recently said he might take Tesla private, has added to those pressures with lofty projections for profits and production that the automaker often fails live up to. Plus, the eccentric billionaire is the head of at least two other companies, including the rocket company SpaceX.

In her open letter, which referenced Musk’s interview with the Times, Huffington urged Musk to ease up on the long hours at work.

“Working 120-hour weeks doesn’t leverage your unique qualities, it wastes them,” she wrote. “You can’t simply power through — that’s just not how our bodies and our brains work.”

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Whistleblower accuses Tesla of spying on employees at Gigafactory – attorney

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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An employee fired from Tesla Inc’s Nevada battery factory filed a whistleblower complaint with the US Securities and Exchange Commission, accusing the company of spying on employees and failing to act after learning that a Mexican cartel may be dealing drugs inside the plant, his attorney said on Thursday.

A former member of Tesla’s internal investigations team, Karl Hansen, filed a tips, complaints and referrals form to the SEC about the Gigafactory on Aug. 9, Hansen’s attorney Stuart Meissner said in a news release. Whistleblowers can receive 10 percent to 30 percent of penalties the SEC collects.

Tesla said it took the allegations that Hansen brought to the electric car maker seriously and investigated.

“Some of his claims are outright false. Others could not be corroborated,” Tesla said in the statement.

The SEC declined comment.

The complaint sent to the SEC comes amid intense focus on the company and Chief Executive Elon Musk, whose tweets about taking the company private last week set off a scramble to determine whether he violated securities law in stating that funding for the deal was “secured.”

Hansen alleged that Tesla, at the direction of Musk, installed surveillance equipment at the Gigafactory outside Reno, Nevada to eavesdrop on the personal cellphones of employees while at work, according to Meissner.

Hansen also claims that Tesla did not disclose to investors that thieves stole $37 million in copper and other raw materials during the first half of 2018, according to his attorney.

Hansen alleges Tesla failed to disclose that it received written notice from the US Drug Enforcement Administration about a Tesla employee possibly engaged in selling cocaine and crystal methamphetamine from the Nevada factory on behalf of a Mexican drug cartel, according to Meissner who did not release the whistleblower filing he said his client made to the SEC.

Reuters could not reach Hansen for comment.

Hansen alleges that he found ties between the Tesla employee and members of the cartel and urged Tesla to disclose that information to the DEA, his attorney said in the news release.

The DEA said it does not notify non-law enforcement entities about investigations.

“Notifying associates of a target of an investigation would likely derail enforcement efforts or compromise the investigation altogether,” the agency said in a statement.

Sheriff Gerald Antinoro of Storey County, where the Gigafactory is located, declined to comment on the allegations of drug dealing. The sheriff did say Tesla reported two thefts but did not disclose what was taken.

“Tesla refused to do so and instead advised him that Tesla would hire ‘outside vendors’ to further investigate the issue,” Meissner said in the news release.

Hansen was subject to retaliation and fired on July 16 after raising the issues internally, he said.

Hansen is the second Tesla employee to file a whistleblower complaint with the SEC.

Martin Tripp, another former Gigafactory worker represented by Meissner, told the SEC that Tesla inflated the number of Model 3s being produced each week, that it used punctured batteries in its vehicles, and that it reused scrapped parts in vehicles “without regard to safety,” according to his attorney.

Tesla denies those claims.

Tripp’s tip to the SEC was filed after he was fired, sued by Tesla for hacking trade secrets and transferring internal documents to third parties.

Musk, in a company-wide email, accused an unnamed Telsa employee of “quite extensive and damaging sabotage to our operations.”

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

SEC scrutiny of Tesla grows as Goldman hints at adviser role

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The US Securities and Exchange Commission has sent subpoenas to Tesla Inc regarding chief executive Elon Musk’s plan to take the company private and his statement that funding was “secured,” Fox Business Network reported on Wednesday, citing sources.

The electric carmaker’s shares fell as much as 4 percent but cut their losses after Goldman Sachs Group Inc said it was dropping equity coverage of Tesla because it is acting as a financial adviser on a matter related to the automaker.

Investors viewed the Goldman statement as confirming a tweet from Elon Musk on Monday about working with Goldman, even as the reported subpoenas indicated the SEC has opened a formal investigation into a matter.

The latest news extended the roller-coaster ride for Tesla investors in recent days, adding to uncertainty about the future course of the company and whether a deal can be done amid growing regulatory complications.

Tesla and the SEC declined to comment.

Musk stunned investors and sent Tesla’s shares soaring 11 percent when he tweeted early last week that he was considering taking Tesla private at $420 per share and that he had secured funding for the potential deal.

The shares fell 2.6 percent to $338.69 on Wednesday, below $341.99, their closing price the day before Musk tweeted his plan to take Tesla private.

The Tesla CEO provided no details of his funding until Monday, when he said in a blog on Tesla’s website that he was in discussions with Saudi Arabia’s sovereign wealth fund and other potential backers but that financing was not yet nailed down.

Musk also tweeted late Monday night he was working with Goldman Sachs and private equity firm Silver Lake as financial advisers. However, as of Tuesday, Goldman was still negotiating its terms of engagement with Musk, according to a person familiar with the matter.

The 47-year old billionaire’s tweet about secured funding may have violated US securities law if he misled investors. On Monday, lawyers told Reuters Musk’s statement indicated he had good reason to believe he had funding but seemed to have overstated its status by saying it was secured.

The SEC has opened an inquiry into Musk’s tweets, according to one person with direct knowledge of the matter. Reuters was not immediately able to ascertain if this had escalated into a full-blown investigation on Wednesday.

This source said Tesla’s independent board members had hired law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP to help handle the SEC inquiry and other fiduciary duties with respect to a potential deal.

The Wall Street Journal said the SEC was seeking information from each Tesla director.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla forms three-member panel to decide on any Musk deal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Tesla Inc’s board named a special committee of three directors on Tuesday to negotiate with Elon Musk on taking the electric carmaker private, although it said it was yet to see a firm offer from the company’s chief executive.

Musk said on Monday he had held talks with a Saudi sovereign fund on a buyout that would take Tesla off the Nasdaq exchange – an extraordinary move for what is now the United States’ most valuable automaker, worth more than $60 billion.

The committee, made up of Tesla independent directors Brad Buss, Robyn Denholm and Linda Johnson Rice, will wade into a deal that has puzzled Wall Street since a surprise announcement by Musk on Twitter last week.

Musk then proposed taking the company private at $420 a share – versus the current $354 – and said funding had been “secured”.

He has given more details – including saying he is working with Goldman Sachs and buyout firm Silver Lake – but is yet to convince Wall Street analysts and investors that he can find the billions needed to complete the deal.

Corporate governance and shareholder voting advisor Institutional Shareholder Services has said it does not consider Buss to be an independent director, running counter to Tesla’s view, due to his connections to a solar panel business the company bought two years ago.

Buss was chief financial officer of solar panel installer SolarCity for two years before retiring when Tesla paid $2.6 billion for the sales and installation firm in 2016.

The purchase was Tesla’s last big deal and was criticized by some on Wall Street because the company, founded by two of Musk’s cousins, had seen its business shrink before the takeover.

Denholm, the first woman to join Tesla’s board, is chief operations officer of telecom firm Telstra and the ex-CFO of network gear maker Juniper Networks. Rice, the first African-American and second woman to join the company’s board, is the chairman of Johnson Publishing Co, home to Ebony and Jet magazines.

Tesla’s other board members include Musk, his brother Kimbal Musk, Twenty-First Century Fox’s CEO James Murdoch, Antonio Gracias, founder of Valor Equity Partners and Ira Ehrenpreis, founder of venture capital firm DBL Partners.

One more director, Steve Jurvetson, is currently on leave of absence following allegations of sexual harassment.

Tesla’s board disclosed on Aug. 8 that Musk had held talks with the directors in the previous week on taking the company private.

The company said in the statement that the special committee has the authority to take any action on behalf of the board to evaluate and negotiate a potential transaction and alternatives to any transaction proposed by Musk.

Latham and Watkins LLP has been retained by the committee as its legal counsel. Wilson Sonsini Goodrich and Rosati will be legal counsel for Tesla itself.

Shares in Tesla inched down 0.2 percent in early trading and have now fallen more than 8 percent from highs hit following Musk’s tweet last week.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

This simple tweet from Elon Musk shows the power of saying ‘thank you’

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Though Elon Musk is a busy man, the billionaire is known to make time to interact with fans and customers on Twitter. One follower even credits a Musk tweet with saving her life.

This spring, jewelry designer Johnna Sabri penned an open letter to the Tesla founder, saying she saw him as an inspiration. When Musk read letter, he tweeted back his gratitude.

“Thank you for the lovely letter,” Musk wrote, later adding “appreciate the letter.”

Sabri later credited Musk’s ‘thank you’ with pulling her out of a dangerous depression. She wrote, “I want to thank Elon Musk for literally saving my life when he replied to one of my tweets.”

While Musk could never have guessed his tweet would have such an effect, it helps to highlight a simple fact: Even the smallest thank you can have a big impact.

In a recent study, researchers found that people “undervalue gratitude,” thinking it will seen as insincere or unwelcome. In one experiment, recipients ranked how happy they were to receive a note of gratitude. Most rated their feelings at a 5, among the top possible, with some even saying they felt ecstatic after receiving a formal thank you. Senders, by contrast, guessed rankings of 3, wrongly believing a thank you note was no big deal.

Key to a great thank you is sincerity. According to the findings, most recipients cared less for the actual phrasing than for the general sense of warmth from the exchange, found professors Amit Kumar, from the University of Texas and Nicholas Epley from the University of Chicago.

“Elon, you are so kind. Thank you for being an inspiration. And thank you for being kind to me,” she responded. “I owe you a lot — my life. Thank you. And I will always believe in the good. It’s who I am. Thank you.”

According to the researchers, understanding the impact of thank you notes is akin to making wise decisions in general. “When we underestimate gratitude,” the researchers write, “We may keep people from engaging in behavior that would maximize their own — and other’s — well-being.”

Source: Make It, CNBC.com

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla’s board seeking more information on Musk’s financing plan

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Tesla Inc’s board has not yet received a detailed financing plan from chief executive officer Elon Musk, and is seeking more information about how he will take the US electric car maker private in a proposed deal worth $72 billion, people familiar with the matter said on Thursday.

While Tesla’s board has held multiple discussions about Musk’s proposal, which first became public on Tuesday, it has not yet received specific information on who will provide the funding, one of the sources said.

Tesla declined to comment.

Musk, a 47-year-old investor and engineer, stunned financial markets on Tuesday, when he revealed on Twitter he was considering a take-private deal for Tesla, an auto manufacturing pioneer that developed the world’s first ever premium all-electric sedan car.

The move came after months of Musk battling investors, journalists and analysts over whether Tesla could turn a profit and produce enough of the mass market model of is flagship electric car to meet demand.

Musk said in a tweet on Tuesday that he had secured financing for the deal, but he did not publicly provide further details.

Speculation has swirled among shareholders and investment bankers about who could fund a deal of that size, especially given that the company’s bonds are already rated junk by credit rating agencies.

The US Securities and Exchange Commission has contacted Tesla to ask about Musk’s assertion on Twitter that funding for his proposed deal was “secured”, the Wall Street Journal reported on Wednesday.

The revelation that the board is seeking more details from Musk could raise new questions about how he plans to finance the deal at his proposed price of $420 per share.

After jumping to close at $379.57 on Tuesday, Tesla shares have since fallen about 7 percent to end trading at $352.45 on Thursday, amid investor scepticism over the deal’s prospects.

In a statement on Wednesday, Tesla’s board said its discussion with Musk “addressed the funding” for the deal, without offering more details.

The board expects to make a decision on whether to launch a formal review of Musk’s proposal in the coming days, and is speaking to investment bankers about hiring financial advisers to assist it in its review in such scenario, the sources said.

If the board launches a formal review of Musk’s bid, he would have to recuse himself, or a special board committee would have to be formed, according to the sources, who requested anonymity because the deliberations are confidential.

The exact information that Musk communicated to the board about his plan could not be learned.

Taking Tesla private would remove the pressure from Musk coming from hedge funds betting that the company’s stock will drop given its production issues and negative cash flow, as well as the glare of Wall Street that comes with reporting quarterly earnings publicly.

The company faces a make-or-break moment in its eight-year history as a public company as competition from European automakers is poised to intensify with new electric vehicles from Audi and Jaguar, with more rivals entering the market next year.

Tesla is still working its way out of what Musk called “production hell” at its home factory in Fremont, California, where a series of manufacturing challenges delayed the ramp-up of production of its new Model 3 sedan on which the company’s profitability rests.

Meanwhile, Tesla has announced plans to build a factory in Shanghai, China, and another in Europe, but details are scarce and funding unknown.

Difficult To Finance

Musk has said he would be looking to keep his ownership of Tesla at around 20 percent in a buyout deal, and that a special purpose vehicle, like the one that exists at his aerospace company SpaceX, would allow Tesla shareholders to remain invested if they so choose.

Investment bankers and analysts have reacted with scepticism, telling Reuters it would be hard for Musk, whose net worth is pegged by Forbes at $22 billion, to raise the equity and debt financing needed for the deal given Tesla is not turning a profit.

Some analysts have suggested that Musk could convince Tesla’s top shareholders, such as Fidelity Investments and China’s Tencent, to roll their equity stakes into the deal, thereby significantly reducing the amount of money needed to be raised.

However, the deal structure would come with big logistical and legal challenges when it comes to buying out smaller shareholders, analysts have said.

Saudi Arabia’s Public Investment Fund (PIF) has taken a stake of less than 5 percent in Tesla, a source familiar with the matter said on Tuesday. It is not clear if PIF is interested in financing Musk’s proposed take-private deal.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla board evaluating CEO’s bid to take company private

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Board members at Tesla are evaluating CEO and Chairman Elon Musk’s $72 billion proposal to take the electric car and solar panel maker private.

Six of nine members say in a statement Wednesday that Musk began talking with the board about the move last week. This included discussing how being a private company could better serve Tesla’s long-term interests. The statement says board members met several times and also addressed funding for the move.

Musk, his brother Kimbal and director Steve Jurvetson were not included in the statement.

The eccentric Musk announced the bombshell move Tuesday on Twitter, writing that he had secured funding to buy Tesla Inc.’s shares at $420 each.

Shares rose 11 percent Tuesday but fell slightly Wednesday to $377.96.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow