Elon Musk, the world's richest man, was expected to receive a huge compensation of US$56 billion (S$75.09 billion) from his electric car giant Tesla Inc, but a shareholder accused him of excessive pay and went to court. A Delaware judge also rejected the huge pay on Tuesday (January 30), causing Musk's wealth to shrink significantly, and Tesla's stock price fell 255％。
Musk expressed his displeasure by saying on his social ** immediately after the judge's ruling: "Never register your company in Delaware". Therefore, many people are also speculating on social platforms that Musk should appeal.
The EV giant co-founder was awarded the world's largest and most lucrative executive compensation package five years ago. Since challenging this compensation package in a Delaware court, Musk has never exercised his ** option under the compensation package.
Musk has repeatedly urged Tesla's board of directors to arrange another huge ** reward for him. In 2022, he had a large number of Tesla shares in order to cash out the acquisition of the social platform X (formerly known as Twitter). Musk has also publicly stated on several occasions since then that he needs to hold more shares in Tesla to maintain control of the electric car maker in order to further expand Tesla's business into the field of artificial intelligence.
However, the Delaware judge said Musk's defense attorneys failed to explain why a "historically unprecedented compensation plan" was necessary to incentivize the CEO to achieve "transformative growth" for the company. The judge also said that Musk has no intention of leaving Tesla, and his existing equity is enough for him to focus on driving the company's growth.
The Delaware judge's ruling has led to a significant reduction in Musk's wealth. According to the report, these compensation packages include Tesla options, worth about $51.1 billion, making them one of his most valuable assets. According to the Bloomberg Billionaires Index, without this part of the assets, his net worth would have fallen to $154.3 billion. In other words, Musk will have to cede the throne of the world's richest man and become the third richest man in the world.
When Tesla released its earnings report last week, Musk said in an analyst conference that he insisted on getting more Tesla shares, explaining that he wanted control of the electric car company, not money.
"I don't want to control it (Tesla), but if I have so little influence over the company at this stage, I might be voted out by some random shareholder advisory firm," Musk said. ”