• Musk is in the Guinness World Records Book: Biggest fortune loss in history
• Major shareholder Leo Koguan suspects Musk of deliberately depressing Tesla’s share price
• Koguan sees two reasons: tax advantages and bonus payments to employees
The Tesla share crash was one of the main topics on the international capital markets in recent weeks. While the Tesla share was able to withstand the tech sell-off comparatively well until September 2022, things then went downhill rapidly for many reasons – from Musk’s Twitter confusion to weaker delivery numbers to weak demand in the important Chinese market. At the end of December, Tesla shares even fell for seven consecutive days before a rather hesitant countermovement followed. Now the major shareholder Leo Koguan, who has remained conspicuously stoic up to now and who rose to become one of the largest individual Tesla shareholders in 2021, is slowly losing patience. His initial enthusiasm for Elon Musk has probably decreased significantly.
Leo Koguan: Major shareholder makes spicy accusation against Musk
Leo Koguan, for example, suspects Tesla CEO Elon Musk of deliberately causing the Tesla share price to fall – and thus the destruction of the capital of millions of shareholders. As he tweeted, Musk is said to have deliberately depressed the price of the paper for tax purposes. Musk did not sell his block of shares, as is usual with sales of this size, via price-friendly block placements with an investment bank, but simply threw the pieces onto the secondary market, according to “Teslamag”. Given the volume of his stock sales — Musk has sold $40 billion worth of Tesla stock since November 2021 — this has had a severe impact on the stock price.
Leo Koguan suspects that the reason for this unusual selling behavior is Musk’s motivation to bring about a lower base price for options in his upcoming next compensation package. According to “Teslamag”, other insiders recently expressed the similar suspicion that Musk wanted to push the price down in order to create more price potential for new Tesla employees, who can always get shares. Musk would welcome the lower stock prices as he hopes to attract desirable, highly skilled employees to Tesla.
@GreyFoxTrotThe one that can’t be named biggest betrayal, if and only if true, he purposely crushed Tesla stock price and its SH for his tax benefits and potential new stock options granted by himself bc he is both the CEO and BOD?
Fund Managers of Tesla, are you listening? https://t.co/gwgYfNdp12
– KoGuan Leo (@KoguanLeo) January 4, 2023
Koguan’s criticism refers not only to Musk’s massive share sales, but also to the general dual role of the tech billionaire at Tesla. Musk is both CEO and a member of the board of directors, which is chaired by Robyn Denholm. Koguan sees Musk’s board position as too concentrated of power, which he sees as extremely problematic for decision-making processes within the company.
Elon Musk’s historic capital loss
Elon Musk’s fortune has plummeted by a whopping $180 billion due to the Tesla stock crash. According to other data circulating on the Internet, the volume of historical capital destruction even amounted to 200 billion US dollars. Either way, Musk lost the pole position of the world’s richest people, which he had held for nearly two years since January 2021. LVMH boss Bernard Arnault is now the richest person in the world. Musk currently ranks second on the Forbes list with a current fortune of around $159 billion, but he was recently joined by Indian business mogul Gautam Adani, Amazon founder Jeff Bezos, Larry Ellison and investor legend Warren Buffett are getting closer.
Since December, the tech entrepreneur has also held the unfortunate record of the largest fortune loss in the world, which promptly earned Musk an entry in the Guinness World Records book. The title reads “highest loss of private wealth in history”. Previously, this unpopular record was held by Japanese internet investor Masayoshi Son. The Softbank founder lost $60 billion during the February-July 2000 dot-com crash.
Tesla shares: price recovery in sight?
After all, the Tesla shares were able to make up some ground in the last few trading days. Latest information shows that Tesla wants to expand its Texas Gigafactory. Musk’s promise not to sell any more Tesla shares in the coming years also brought positive impetus. The Tesla shares have at least distanced themselves somewhat from the USD 100 mark, which was at times close, and are currently trading at USD 143.92 (as of the closing price on January 24, 2023). Some analysts are seeing an excellent buy opportunity after the stock’s plunge as they continue to rate the EV maker’s prospects as great. Ben Kallo from the investment bank Baird even sees Tesla shares as the “best investment idea” in the stock market year 2023 as a result of the price crash. His target price: 250 US dollars, which would roughly double the share price. Other analysts, such as JPMorgan’s Ryan Brinkman, argue that Tesla’s stock is still significantly overvalued, especially when compared internally to peers like Volkswagen and General Motors.
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