Divorce threatens Tesla Motors IPO
It’s a plot worthy of Hollywood: an estranged science fiction writer threatens to derail a quirky industrialist’s plans to design and build electric vehicles.
In the high stakes world of Tesla Motors CEO, Elon Musk, this is reality. Musk has been involved in bitter divorce proceedings with his wife, Justine, an LA-based author for several months now. At stake in the divorce is $465 million in government funding that Tesla Motors needs to continue development of the Model S all-electric sedan and to keep their initial public offering on schedule.
Musk is one of the wealthiest Americans under the age of forty with a net worth in excess of $300 million. He co-founded PayPal and made an early fortune when the business was sold in 2002 to eBay for $1.5 billion.
Musk is best known today as the CEO of Tesla Motors, which manufactures the nation’s only highway-legal, no-strings-attached electric vehicle, the Tesla Roadster. He is also the CEO and CTO of SpaceX, a commercial space exploration company that holds a $1.6 billion contract with NASA to send low-cost rockets to the International Space Station once the Space Shuttle is retired later this year.
Musk also starred across Robert Downey Jr. with a cameo in Paramount’s Iron Man 2.
Justine Musk has requested 10 percent of her husband’s stake in Tesla Motors as part of the divorce. But according to Tesla’s filing with the Securities and Exchange Commission, the company could be in default of the $465 million loan if Elon Musk does not continue to hold a minimum amount of stock. Such a move could require Tesla to modify the terms of its loan and delay plans for an initial public offering.
It is unclear how much stock Musk currently owns because the company is privately held and does not disclose information on outstanding shares. Spokesperson Ricardo Reyes said that Tesla is not planning to change its IPO filing statement at this time.
In addition to the stake in Tesla, Justine Musk is also requesting 5 percent of Elon’s stake in SpaceX, $6 million in cash, alimony, child support, the couple’s Bel Air home, and a brand new $101,500 Tesla Roadster. “I really, really want one…” she explains on her personal blog.
2 Comments
Oddly, I read Blood Angel a few years back and enjoyed it. It was a shock to find out Elon was his wife – simply because I never thought about it. And while I admire SpaceX, want and Tesla, and use paypal, I have to side with the one who didn’t go out and grab a mate 20 years his junior. But again, none of this matters because I don’t know them or even what they look like in person. It doesn’t stop me from loving the Tesla.
I agree Tesla is a good company but I have become agnostic of the stock market and have never put much faith in IPOs. A great company does not a profitable investment make.