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What would it mean if SpaceX buys Tesla though? Does the combined market cap count? That would be wrong. Tesla buying SpaceX just for hist bonus and then rebran

by andruby 3mo ago

What would it mean if SpaceX buys Tesla though? Does the combined market cap count? That would be wrong. Tesla buying SpaceX just for hist bonus and then rebranding to X would be classic Musk. It's a game for him, but so ridiculous. While Tesla was pushing electrification and SpaceX pushing rapid rocket re-use I kind of tolerated Elon's antics, but since he got involved in politics and DOGE I can't bear it anymore.

lesuorac 3mo ago
> Does the combined market cap count? That would be wrong. It counts and it's not wrong. Sure, the Tesla award takes into account any M&A but growing a 2T company to 3T is a 50% increase. While growing a 1T company to 2T is a 100% increase so it's expected to be easier for him to hit his award targets with the companies merged as opposed to not merged.
- andruby 3mo ago
  I understand Tesla acquiring other companies counting to the cap, but Tesla _being acquired_ by another company, why would that count?
  - lesuorac 3mo ago
    Because that's the grand plan from the start. You don't put a sentence like "In other words, upon a change in control where Tesla is acquired, vesting of milestones under the CEO Performance Award does not require the achievement of a matching Operational Milestone." if you didn't think Tesla could be acquired. The goal is to give Elon his 2012 award package but making it his 2018 one.
- xmprt 3mo ago
  If we combine the market cap of the entire S&P500 we get close to 70T. That doesn't mean any of those individual companies are any more valuable or any of the investors are any richer. It makes no sense that Tesla shareholders would be ok with paying out a performance bonus just for M&A that doesn't grow the value of Tesla and would just dilute their shares.
  - s1artibartfast 3mo ago
    Most are tied to operational milestones as well if I understand correctly
    - lesuorac 3mo ago
      As pointed out by somebody else [1]; Operational Milestones are waived if SpaceX buys Telsa. [1]: https://news.ycombinator.com/user?id=antasvara https://news.ycombinator.com/user?id=antasvara
      - s1artibartfast 3mo ago
        Thats not what it says. My understanding is SpaceX milestones stay intact. For Tesla ops milestones they would be waived, this is fine because accusition is a chance for Tesla shareholders to cash out at that price.
        lesuorac 3mo ago
        We're talking about his Tesla grant so SpaceX's grant is irrelevant. The text written in the link you did not read, states "Notwithstanding Sections I, II and III above, in the event of a Change in Control, the Operational Milestones shall be disregarded".
        s1artibartfast 3mo ago
        The link supports wxactly what I wrote. Not sure where your confusion is.
  - appplication 3mo ago
    Well yeah it doesn’t make a ton of sense but the shareholders already cast their vote on this. I’m not sure what they expect would happen but I also don’t think they care. Elons shareholders are a special kind of financial sycophant.
- paulddraper 3mo ago
  It the shareholders' value that counts. And that doesn't get any more by 50% increase with the same dilution.
  - adgjlsfhk1 3mo ago
    the problem is Tesla's board is controlled by musk
antasvara 3mo ago
>What would it mean if SpaceX buys Tesla though? Does the combined market cap count? That would be wrong. I took a look at the proxy statement as they have it outlined in this [0] document (Proposal 4). As currently formulated, Musk has 12 operational goals (like ship 1 million robots or hit 50 billion EBITDA) and 12 market cap goals. These need to be paired together for the shares to vest; so, if he reaches the first market cap number, he also needs to fulfill an operating goal for the first set of shares to be earned. These earned shares vest in ~5 years. This comes with a huge caveat. If Tesla changes control, those operational goals go out the window and his stock award is based solely on market cap (along with the shares immediately vesting). The share price for this is the greater of: 1. The last traded Tesla price prior to the acquisition, or 2. The per share price outlined in the acquisition. The "easiest" way to take advantage is to IPO SpaceX (which he did), pump up the market cap, acquire Tesla for a sizable premium, and vest as much of the stock award as you can. It means you get to avoid the operational goals entirely and vest a bunch of Tesla (but soon to be SpaceX) stock. [0]: https://www.sec.gov/Archives/edgar/data/1318605/000110465925087598/tm252289-4_pre14a.htm#tKTPC https://www.sec.gov/Archives/edgar/data/1318605/000110465925...
- NuclearPM 3mo ago
  Conflict of interest laws don’t apply to fascists.
  - brigandish 3mo ago
    Fascists don't support free speech. Please, learn what that word means[0] and then use it responsibly. We're already seeing the effects of misusing and overusing several other important words for political/societal discourse, and this is one of them. It's entirely unhelpful and lowers the quality of conversation here. [0] The Doctrine of Fascism is available, for free, in several places. Start there.
    - bakies 3mo ago
      Elon fits the definition in Britannica pretty neatly
mcintyre1994 3mo ago
I feel like it has to eventually become X. Just because he’d find it funny for the stupidest people in the world to post about how he’s turned Twitter into a $2t or whatever company.

by andruby 3mo ago

lesuorac 3mo ago

> Does the combined market cap count? That would be wrong. It counts and it's not wrong. Sure, the Tesla award takes into account any M&A but growing a 2T company to 3T is a 50% increase. While growing a 1T company to 2T is a 100% increase so it's expected to be easier for him to hit his award targets with the companies merged as opposed to not merged.

andruby 3mo ago
I understand Tesla acquiring other companies counting to the cap, but Tesla _being acquired_ by another company, why would that count?
- lesuorac 3mo ago
  Because that's the grand plan from the start. You don't put a sentence like "In other words, upon a change in control where Tesla is acquired, vesting of milestones under the CEO Performance Award does not require the achievement of a matching Operational Milestone." if you didn't think Tesla could be acquired. The goal is to give Elon his 2012 award package but making it his 2018 one.
xmprt 3mo ago
If we combine the market cap of the entire S&P500 we get close to 70T. That doesn't mean any of those individual companies are any more valuable or any of the investors are any richer. It makes no sense that Tesla shareholders would be ok with paying out a performance bonus just for M&A that doesn't grow the value of Tesla and would just dilute their shares.
- s1artibartfast 3mo ago
  Most are tied to operational milestones as well if I understand correctly
  - lesuorac 3mo ago
    As pointed out by somebody else [1]; Operational Milestones are waived if SpaceX buys Telsa. [1]: https://news.ycombinator.com/user?id=antasvara https://news.ycombinator.com/user?id=antasvara
    - s1artibartfast 3mo ago
      Thats not what it says. My understanding is SpaceX milestones stay intact. For Tesla ops milestones they would be waived, this is fine because accusition is a chance for Tesla shareholders to cash out at that price.
      - lesuorac 3mo ago
        We're talking about his Tesla grant so SpaceX's grant is irrelevant. The text written in the link you did not read, states "Notwithstanding Sections I, II and III above, in the event of a Change in Control, the Operational Milestones shall be disregarded".
        s1artibartfast 3mo ago
        The link supports wxactly what I wrote. Not sure where your confusion is.
- appplication 3mo ago
  Well yeah it doesn’t make a ton of sense but the shareholders already cast their vote on this. I’m not sure what they expect would happen but I also don’t think they care. Elons shareholders are a special kind of financial sycophant.
paulddraper 3mo ago
It the shareholders' value that counts. And that doesn't get any more by 50% increase with the same dilution.
- adgjlsfhk1 3mo ago
  the problem is Tesla's board is controlled by musk

antasvara 3mo ago

>What would it mean if SpaceX buys Tesla though? Does the combined market cap count? That would be wrong. I took a look at the proxy statement as they have it outlined in this [0] document (Proposal 4). As currently formulated, Musk has 12 operational goals (like ship 1 million robots or hit 50 billion EBITDA) and 12 market cap goals. These need to be paired together for the shares to vest; so, if he reaches the first market cap number, he also needs to fulfill an operating goal for the first set of shares to be earned. These earned shares vest in ~5 years. This comes with a huge caveat. If Tesla changes control, those operational goals go out the window and his stock award is based solely on market cap (along with the shares immediately vesting). The share price for this is the greater of: 1. The last traded Tesla price prior to the acquisition, or 2. The per share price outlined in the acquisition. The "easiest" way to take advantage is to IPO SpaceX (which he did), pump up the market cap, acquire Tesla for a sizable premium, and vest as much of the stock award as you can. It means you get to avoid the operational goals entirely and vest a bunch of Tesla (but soon to be SpaceX) stock. [0]: https://www.sec.gov/Archives/edgar/data/1318605/000110465925087598/tm252289-4_pre14a.htm#tKTPC https://www.sec.gov/Archives/edgar/data/1318605/000110465925...

NuclearPM 3mo ago
Conflict of interest laws don’t apply to fascists.
- brigandish 3mo ago
  Fascists don't support free speech. Please, learn what that word means[0] and then use it responsibly. We're already seeing the effects of misusing and overusing several other important words for political/societal discourse, and this is one of them. It's entirely unhelpful and lowers the quality of conversation here. [0] The Doctrine of Fascism is available, for free, in several places. Start there.
  - bakies 3mo ago
    Elon fits the definition in Britannica pretty neatly

mcintyre1994 3mo ago

I feel like it has to eventually become X. Just because he’d find it funny for the stupidest people in the world to post about how he’s turned Twitter into a $2t or whatever company.