Tesla Climbs After Adding Oracle Founder, Walgreens Executive To Board

Tesla (TSLA) climbed on Friday after the company announced plans to add Larry Ellison and Kathleen Wilson-Thompson to its board in compliance with a settlement with the Securities and Exchange Commission. The additions boost the size of Tesla's board to 11. 

TESLA ADDS NEW BOARD MEMBERS

Ellison is the founder and executive chairman of Oracle (ORCL), and disclosed in October that his second-largest personal investment is in Tesla. At the Oracle OpenWorld conference, Ellison commented that "I am not sure people know I am very close friends to Elon Musk and I am a very big investor in Tesla," adding that he thinks Tesla "has a lot of upside." At the conference, Ellison defended Tesla CEO Elon Musk, saying "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." Tesla's other board appointee is Kathleen Wilson-Thompson, the global head of human resources at Walgreens Boots Alliance (WBA). With the appointments, Tesla's board increased the number of directors to 11 from nine.  Tesla's board of directors said in a statement this morning that "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."

WHAT'S NOTABLE

Tesla and CEO Musk agreed in September to name a new chairman and two independent board members following an SEC lawsuit alleging that Musk misled investors with a tweet about taking the company private at $420 per share. He did not pursue any go-private deal and pulled back on those plans a few weeks later. The SEC would eventually charge him with securities fraud, with both parties reaching a settlement not long after, and Musk agreeing that his “communications relating to the company… including Twitter” would be overseen by his board. In a wide-ranging interview on CBS's "60 Minutes," Musk said his tweets are not approved by the automaker prior to publication."The only tweets that would have to be reviewed, would be if a tweet had a probability of causing a movement in the stock. Otherwise, it's hello, first amendment. Freedom of speech is fundamental […] I want to be clear, I do not respect the SEC,” Musk said, adding that he uses his tweets “to express myself.” Musk previously relinquished his role as chairman of Tesla's board as part of the SEC settlement, being replaced by Robyn Denholm, and in November, both he and the company agreed to pay $20M penalties.

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