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Tesla investor accuses Elon Musk of driving stock down

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  • Tesla investor Leo Koguan wondered if Elon Musk was intentionally crushing Tesla shares.
  • On Friday morning, Tesla stock was trading at its lowest level since August 2020.
  • Koguan has criticized Musk’s preoccupation with Twitter in recent weeks.

Leo Koguan, a major Tesla investor who once called himself “Elon’s fanboy,” questioned whether Elon Musk intentionally lowered shares of the electric car maker on Thursday.

Koguan, who is “one of Tesla’s largest individual shareholders”, according to Bloomberg, had amassed about 22.6 million Tesla shares as of August 27, 2022. He made the Forbes list of the world’s 400 richest people. in September largely because of his investment in Tesla.

“This is compelling evidence that he deliberately lowered the price in violation of his fiduciary duty,” Koguan said. tweeted Thursday in response to another Twitter user who said Musk drove the price down when he sold more of his Tesla stock last year. “The board did not arrest him as well in violation of their fiduciary duty. One should ask if the CEO and board are acting as one person in violation of security law?”

In December, the Tesla CEO sold more of his holdings in the company after selling nearly $40 billion worth of Tesla stock over the past 15 months. At the time, he promised not to sell any more shares for “probably in two years”, but it’s a promise he has made and broken in the past.

Koguan also questioned Musk’s intentions with Tesla shares earlier in the week.

“The one that can’t be named the greatest betrayal, if and only if true, he deliberately crashed Tesla’s stock price and his SH for his tax advantages and the new stock options potential grants granted by himself because he is both the CEO and the board?” Koguan tweeted Wednesday morning. “Tesla fund managers, are you listening?”

Koguan directed his Wednesday tweet to Alex Lagetko, the founder of VSO Capital, a small private investment firm. Lagetko said in a long twitter thread in response to Koguan that he thinks Musk would “benefit from poor financial results (manifested in under-reporting of sales and profits)”, pointing to Musk’s Tesla compensation plan – which was challenged as part of a shareholder lawsuit against Tesla and Musk.

Musk’s salary package centers on a series of goals around the automaker’s financial growth that was put in place in 2018. Specifically, the plan involves a 10-year grant of 12 tranches of stock options, which are acquired when Tesla achieves certain goals. When each milestone is met, Musk gets shares equal to 1% of the shares outstanding at the time of grant. The company has since surpassed the metrics.

“Because Musk reached all market capitalization milestones in 2021, he no longer had any incentive under the compensation plan to maximize shareholder value,” Lagetko tweeted. “He had every interest in seeing the stock go down (for tax reasons) or pursuing his personal aspirations (buying Twitter) knowing he had a huge amount of fresh options coming up that he could exercise when the stocks are trading as low as possible.”

Musk, Koguan and Lagetko did not respond to a request for comment from Insider ahead of publication.

On Friday morning, Tesla stock was trading around $105 per share, its lowest level since Aug. 12, 2020, amid slowing Chinese demand.

Earlier this year, Musk became the first person to lose $200 billion in net worth. The Tesla CEO’s fortune, largely tied to his shares in Tesla, declined as the company’s stock price fell. Some analysts attributed the decline in the share price to Musk’s focus on Twitter in addition to the economic downturn. But last month, Musk told shareholders he would make sure they “benefit from Twitter for the long term.”

Koguan has criticized Musk’s involvement with Twitter in the past. In December he said on Twitter that Tesla needs a new CEO. Although on Thursday Koguan said he planned to buy more than a million shares of Tesla this month and told his Twitter followers he was speaking out against Musk to protect “blind cult fanboys from themselves.”

“I was his blind fanboy, but no more. I can’t save Tesla alone,” he said. tweeted. “We need all SH and institutional fund managers to fix Tesla’s governance anomaly because we love Tesla.”


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