Elon Musk No Longer World's Richest After Judge Voids $51 Billion Pay Package
February 2, 2024
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3:39Now PlayingElon Musk No Longer World's Richest After Judge Voids $51 Billion Pay Package
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as posted by the channelElon Musk ceded the title of world’s richest person to Frenchman Bernard Arnault of luxury conglomerate LVMH Tuesday evening, after a Delaware judge voided a hefty package of performance-based Tesla options awarded to Musk in 2018. Those shares had been worth more than $50 billion. Forbes estimates that Musk is now worth $184.5 billion. He now trails Arnault (estimated net worth: $210.8 billion) but remains ahead of the world’s third richest person, Amazon’s Jeff Bezos ($179 billion).
In her ruling, Delaware judge Kathaleen McCormick determined that Musk and his co-defendants, Tesla and certain of its board members, failed to prove that the process underlying the award of “the largest potential compensation opportunity ever observed in public markets” was fair due to conflicts of interest and Musk’s “control” over the board. Musk’s options were worth $50.9 billion (net of exercise cost) at Tuesday’s stock market close (the value of the package varies based on Tesla's stock price; Tesla estimated that the options would be worth $55.8 billion upon fully vesting, which occurred in late 2022). Because of the ruling, he won’t be able to exercise or sell them. Given the high level of uncertainty about what comes next–including an appeal of the ruling, Forbes has discounted Musk’s options by 50%, enough to knock his net worth down by $25.5 billion after the decision.
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