From Reuters
SAN FRANCISCO/BOSTON (Reuters) – Elon Musk replied with a Tweet saying: “This is incorrect” after the Financial Times reported that outgoing Twenty-First Century Fox Inc Chief Executive James Murdoch was the lead candidate to replace him as Tesla Inc chairman.
News Corp Deputy Chief Operating Officer James Murdoch attends the Allen & Co Media Conference in Sun Valley, Idaho July 12, 2012. REUTERS/Jim Urquhart
Tesla has until Nov. 13 to appoint an independent chairman of the board, part of settlements reached last month between Tesla, Musk and U.S. regulators after Musk tweeted in August that he had secured funding to take the electric car maker private.
The SEC settlement capped months of debate and some investor calls for stronger oversight of Musk, whose recent erratic public behavior raised concerns about his ability to steer the money-losing company through a rocky phase of growth.
The U.S. Securities and Exchange Commission, which said Musk’s tweeted statements about going private were fraudulent, allowed the billionaire to retain his role as CEO while requiring he give up his chairmanship.
Musk had said he was considering taking Tesla private at a price of $420 a share, a number that is slang for marijuana. He tweeted the three-word denial of the Financial Times story, on Wednesday at 4:20 pm PT (2320 GMT), about six hours after the newspaper’s post.
In a vote of confidence for Musk, shareholder T. Rowe Price Group Inc said in a regulatory filing on Wednesday that it had raised its stake to 10.2 percent at the end of September from just under 7 percent in June.
The Financial Times cited two people briefed on discussions saying Murdoch was the lead candidate for the job.
Murdoch, already an independent director of Tesla, has signaled he wants the job, the report said.
The son of Fox mogul Rupert Murdoch, he joined Tesla’s board last year after years of work with media companies. He has no experience in manufacturing and has never led a company that makes cars or electric vehicles.
Murdoch could not immediately be reached for comment. Tesla did not respond to a request for comment. Twenty-First Century Fox declined to comment.
Board roles
Musk is the public face of Tesla, and any chairman would have to contend with his powerful personality. Thanks to his vision and audacious showmanship, Tesla’s valuation has at times eclipsed that of traditional, established U.S. automakers with billions in revenues and the company has garnered legions of fans, despite repeated production issues.
“The question when it comes to James Murdoch is, ‘Is he the guy who’ll be able to establish that level of authority with Elon Musk?’” asked Abby Adlerman, CEO of Boardspan, a corporate governance consulting company.
Murdoch, who at 45 is a near contemporary of 47-year-old Musk, recently navigated a takeover battle between Fox and Comcast Corp to buy European pay-TV company Sky, which he also chaired.
His record in ensuring Sky’s independent shareholders were represented throughout was exemplary, media analyst Alice Enders said.
“His experience is very recent and very relevant,” she said.
Investor concerns that Tesla’s board was too closely tied to Musk led to the company’s addition of two independent directors, including Murdoch, in July 2017.
