Sign up now for FREE unlimited access to Reuters.com Register June 10 (Reuters) – Electric vehicle maker Tesla Inc. (TSLA.O) on Friday proposed a three-to-one split, making its shares more affordable following recent sales by the most valuable automaker. The company also said that Oracle Corp. co-founder Larry Ellison, a friend of Tesla CEO Elon Musk, would not run for re-election to Tesla’s board at the end of his term at this year’s shareholders’ meeting. Ellison is among the top investors who have pledged $ 44 billion in funding for Musk’s $ 44 billion acquisition of Twitter. Sign up now for FREE unlimited access to Reuters.com Register Shares of Tesla, based in Austin, Texas, rose more than 1% in extended trading on Friday. They have fallen nearly 40 percent since Musk revealed his Twitter account in early April, hurt in part by a severe lockdown in Shanghai that affected Tesla production. Shareholders will vote on the proposed split of Tesla shares on August 4. If approved, it would be the company’s first such move since a five-on-one split in August 2020. Read more Tesla said the split would allow its employees to “have more flexibility in managing their own funds” and make its shares “more accessible to our private shareholders”. While a split has nothing to do with the fundamentals of a company, it could raise the stock price by making it easier for a wider range of investors to own the stock. Tesla will also ask shareholders to vote to reduce its board of directors from two to three years. If approved, the terms will be scaled up over two years.
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Meanwhile, Tesla shareholders’ proposals include issues related to corporate governance, such as the right of employees to form a union, and Tesla’s efforts to prevent sexual harassment and racial discrimination. “In 2021, the National Labor Relations Council ratified a 2019 decision under which Tesla illegally fired an employee who had joined a union and that the CEO had illegally threatened employees about the union,” according to a proposal. shareholders referred to in the Tesla deposit. In March, Musk called on the United Auto Workers (UAW) union to hold a vote at Tesla’s California plant. However, “Tesla has no formal political commitment to respect for the right to freedom of association, nor has it demonstrated how such a commitment would work effectively,” the proposal said. Tesla’s board recommended that the proposal be voted down, saying that Tesla had recently increased the basic pay for its construction jobs and was “actively involved” in protecting workers’ rights. Shareholders also proposed an annual report on Tesla’s efforts to prevent sexual harassment and racial discrimination following a series of lawsuits. A California civil rights agency has filed a lawsuit accusing Tesla of failing to address widespread racist behavior at the Fremont assembly plant for years. Tesla said it “does not tolerate discrimination, harassment, retaliation or any ill-treatment of workers in the workplace.” Another resolution called on Tesla to assess the “impact of Tesla’s current use of arbitration on the prevalence of harassment and discrimination in the workplace.” The shareholders also invited the company to report its policies to address the perceived lack of gender and racial diversity on its board of directors. Sign up now for FREE unlimited access to Reuters.com Register Report by Akash Sriram in Bengaluru and Hyunjoo Jin in San Francisco. Editing by Shinjini Ganguli, Matthew Lewis and Richard Chang Our role models: The Thomson Reuters Trust Principles.
