Yahoo Sports Tesla Announced 3-for-1 Stock Split, Larry Ellison To Step Down as Board Member
Tesla finally revealed the long-awaited details of its stock split — it’s going to be 3-for-1– late on June 10 in a Securities and Exchange Commission (SEC) filing. The company also said that board member Larry Ellison would be stepping down and not be replaced.
Find: 9 Bills You Should Never Put on Autopay
Advice: Unplug These Appliances That Hike Up Your Electricity Bill
Investors have been awaiting the details since a split was announced in late March. Tesla announced at the time that it would ask shareholders to vote to authorize additional shares (in order to enable a stock split) at this year’s annual meeting. The company said the split will enable more investors to afford to invest in it and broaden its audience and reach.
Shares of Tesla have been struggling recently — most notably since CEO Elon Musk’s $44 billion Twitter deal was announced in April — and are down 44.8% year-to-date. It’s also down about 5% so far the morning of June 13.
The company said in the SEC filing that its “success depends on attracting and retaining excellent talent, not only through providing a respectful, safe, inclusive and equitable workplace, but also through offering outstanding benefits and highly competitive compensation packages.”
It added that since its previous stock split in August 2020, its stock price rose 43.5% as of June 6, 2022.
“We believe the Stock Split would help reset the market price of our common stock so that our employees will have more flexibility in managing their equity, all of which, in our view, may help maximize stockholder value. In addition, as retail investors have expressed a high level of interest in investing in our stock, we believe the Stock Split will also make our common stock more accessible to our retail shareholders,” according to the filing.
Tesla said, “Our Board intends to approve the Stock Split, subject to and contingent upon stockholder approval of the Authorized Shares Amendment.”
Crypto on the GO: Our Latest Page for All Things Cryptocurrency
Gary Black, managing partner of the Future Fund, tweeted on June 10 that “$TSLA announced a 3:1 stock split to be approved at the 8/4 AGM. I’m old enough to remember what happened in August 2020, when $TSLA announced a 5:1 stock split on 8/11 which became effective 8/31. During those 20 days, TSLA rose +81.3% (vs NDX +11.3%).”
Separately, the electric vehicle (EV) company said that Larry Ellison — who owns 1.5% of Tesla shares — “will not stand for re-election to the Board when his current term ends at the 2022 Annual Meeting.” Tesla added, “The Board currently expects to reduce the number of Board seats to seven upon the expiration of Mr. Ellison’s term at the 2022.” The SEC filing also shows that Musk owns 23.5% of Tesla shares, while Vanguard owns 6% and BlackRock owns 5.1%.
Wedbush Securities analyst Dan Ives tweeted, “Tesla proposes 3:1 stock split. This was long awaited by shareholder base and a smart move by Board. There has been lot of questions around this from the Street the last few months.” He added, “Larry Ellison leaving Tesla Board not a shocker to the Street, although not having him on the Board will be difficult shoes to replace.”
More From GOBankingRates
This article originally appeared on GOBankingRates.com: Tesla Announced 3-for-1 Stock Split, Larry Ellison To Step Down as Board Member
