In a regulatory filing released Friday afternoon, Tesla said it would ask shareholders to approve its second stock split in less than two years at its next annual meeting, after discussing a split earlier this year.
- Tesla said in its annual proxy filing that it will hold a shareholder vote to allow a 3-for-1 split of its common stock at its next annual meeting on Aug. 4.
- The company pointed out that its share price has risen about 40% since its last split and said it believes another split would ‘help reset the market price’ to give employees more flexibility. in the management of their shares and to make the shares more accessible to retail investors.
- Tesla had already discussed the division project in April.
- In the filing on Friday, Tesla also revealed that billionaire Larry Ellison, co-founder and executive chairman of Oracle, will step down from the company’s board of directors at the annual meeting and will not seek to replace him. which would reduce the number of council seats to seven.
- Tesla stock, which has tumbled 42% this year, rose 1.3% to $703 in after-hours trading immediately after the announcement, trimming losses by 3% on the day.
The stock split would be the electric vehicle maker’s second during the pandemic and follows a string of other tech heavyweight announcements. In February, Alphabet, Google’s parent company, announced a 20-to-1 stock split, and in July 2020, Apple announced a 4-to-1 stock split. Some experts say that although the stock splits are largely symbolic, falling stock prices make stocks more affordable to a wider group of investors. “From what we’ve seen in the market with Tesla and Nvidia, people like to chase splits,” portfolio manager David Wagner of Aptus Capital Advisors recently told Forbes, referring to a rise of over 70% of Tesla’s stock price within 20 days of announcing and completing its latest stock split.
Less than three months after prices surged ahead of its latest split, Tesla announced it was looking to raise up to $5 billion in a stock offering.
$215 billion. This is the amount that the fortune of Elon Musk, 50, CEO of Tesla, was worth on Friday, according to Forbes, which makes him the richest person in the world.
Article translated from Forbes US – Author: Jonathan Ponciano
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