Tesla CEO Elon Musk's bid for more pay gets a billionaire's backing
How does Ron Baron describe Elon Musk's role and impact at Tesla in his open letter?
In his open letter, Ron Baron, the billionaire shareholder and CEO of Baron Capital, describes Elon Musk's role at Tesla as the "ultimate 'key man' of key man risk." He emphasizes that without Musk's relentless drive and uncompromising standards, there would be no Tesla. Baron also believes that if shareholders want to protect and grow their investment, they must approve Musk's compensation contract.
What potential impact could the approval or rejection of Musk's pay package have on Tesla's stock value according to Morgan Stanley's informal poll?
According to Morgan Stanley's informal poll, the approval or rejection of Elon Musk's pay package could have a significant impact on Tesla's stock value. Many of the institutional clients polled believed that if the pay package is approved, it would be a positive for the stock. However, if the pay package is rejected, it could be a huge negative for the stock in the near term. This suggests that the outcome of the shareholder vote could lead to substantial volatility in Tesla's stock price.
How significant is Ron Baron's influence as a shareholder in Tesla?
Ron Baron, the chairman and CEO of Baron Capital, is a significant shareholder in Tesla and has been a longtime supporter of CEO Elon Musk. His firm, Baron Capital, holds almost 6 million Tesla shares, which accounts for about 7% to 8% of its total assets. Baron Capital's assets under management totaled $43 billion in the first quarter.
Baron's influence as a shareholder is further amplified by his recent public support for Elon Musk's $56 billion pay package, which is up for a shareholder vote. In an open letter, Baron praised Musk's "relentless drive and uncompromising standards" and stated that "without [Musk], there would be no Tesla." This endorsement from a major shareholder could potentially sway other shareholders' opinions on the pay package and demonstrates the significant influence Baron holds within the Tesla investor community.