Co-Founder of Oracle Larry Ellison Joins Tesla's Board
Tesla added two new members to its board on Thursday. The electric automaker named Oracle co-founder Larry Ellison and Kathleen Wilson-Thompson to its board in compliance with an SEC settlement reached in September.
Ellison and Wilson-Thompson began serving on the board effective Dec 27.
Ellison, a well known figure in Silicon Valley, is the co-founder and executive chairman of computer technology company Oracle. Wilson-Thompson is the global head of human resources at Walgreens Boots Alliance and a former executive at food company Kellogg.
"In conducting a widespread search over the last few months, we sought to add independent directors with skills that would complement the current board's experience. In Larry and Kathleen, we have added a preeminent entrepreneur and a human resources leader, both of whom have a passion for sustainable energy," Tesla's existing directors said in a statement.
Although the two new board members are supposed to be independents, Ellison recently disclosed a massive personal stake in Tesla, raising some concerns about Tesla CEO Elon Musk's continuing influence over the board after being forced to step down as chairman.
"I am very close friends to Elon Musk and I am a very big investor in Tesla," Ellison said at a financial analyst meeting at the Oracle OpenWorld conference in October.
Ellison owns 3 million shares of Tesla stock, according to a company spokesperson. That stake would be worth close to $1 billion at Friday's opening price. Tesla share jumped 5 percent after the news was announced today rising above $330 per share.
In October, Ellison said Tesla was his second-largest holding and vigorously defended Musk against ongoing criticism of his behavior.
"You are telling me he is an idiot. I just want to know who you are so I know why I should believe you as opposed to my friend Elon," Ellison said at the time.
According to CNBC, Tesla downplayed Ellison and Musk's personal relationship, saying the two had only socialized a handful of times and always in a group setting. The spokesperson said Musk and Ellison had not spoken for about a year leading up to Ellison's appointment to the board.
As part of the SEC settlement, Musk agreed to step down as board chairman and appoint two new independent board members. The SEC began investigating Tesla after Musk tweeted on August 7 that he was considered taking Tesla private at $420 per share. The tweet riled investors and spurred the SEC investigation who accused Musk of misleading investors.
The SEC also charged Tesla with failing to have required disclosure controls and procedures relating to Musk's tweets. Tesla and Musk were each fined $20 million which they agreed to pay as part of the settlement.
Tesla's board has historically been tightly linked to Musk. However, the stipulation in the SEC settlement was intended to introduce more oversight of the Tesla CEO, who has dragged the company's stock lower with his unchecked use of social media.
In addition to appointing two new board members, Tesla agreed to form a committee to oversee other terms of the SEC settlement, and institute tighter controls over both the company's and Musk's statements about Tesla on social media.
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