MarketWatch First Take: Why Tesla investor Ross Gerber backed down from his activist push for a board seat

by | Feb 27, 2023 | Stock Market

Tesla Inc. investor Ross Gerber backed down from his efforts to get a seat on the electric-vehicle company’s board after he got what he wanted. On Friday, after the market closed, Gerber said in a tweet that he would withdraw his nomination to join the Tesla
board of directors, stating that as a “friendly activist” he felt shareholders had been heard. In a conversation with MarketWatch later that day, the co-founder and CEO of Gerber Kawasaki Wealth and Investment Management said that Tesla representatives had promised him access and change, leading to his decision to avoid what could have been an unpleasant situation.

“There was no real reason for me to push into what could be a hostile situation,” Gerber said. “I manage people’s money for a living and I have my own company.”

Gerber Kawasaki is an investment advisory firm that also has its own ETF, AdvisorShares Gerber Kawasaki
which has Tesla as its top investment, and has attracted many clients with Tesla shares in its portfolios. Gerber has been a longtime bull on Tesla, so some bearish investors may have been pleasantly surprised by his announcing he would try to get a seat on Tesla’s board, in part because he was not happy with Tesla’s lack of a public relations team to deal with its many crises since Chief Executive Elon Musk bought Twitter Inc. and took it private. After announcing the idea on Twitter in January and speaking to some reporters, including MarketWatch, in mid-February, Gerber disclosed his intentions in a letter to Tesla’s general counsel. But it may not have been too difficult for Tesla to dissuade Gerber from his plans after he was guaranteed some one-on-one meetings with Tesla executives, possibly including Musk, at Wednesday’s investor-day event. “They said they will try to set that all up for me, there will be time to meet with different division heads and executives,” Gerber told MarketWatch. “There is no conflict between my ideas and what they want.” Gerber said Tesla was receptive to his ideas, which focus on combatting negative perceptions of the company through advertising and PR, having responses during times of crises, and convincing Wall Street that the company is more than Musk. “There is so much complication to being on the board, especially for me, because the whole goal was to try and get the company to respond, to spend money on advertising and have a really proactive PR team,” he said. Beyond just changing the current narrative, he also sees legitimate problems that need attention, such as Tesla’s service department. “They grew too quick, they don’t have the teams big enough to service the amount of cars out there, they are focused on improving that,” he said. Gerber also said be believes Tesla will showcase more compan …

Article Attribution | Read More at Article Source

Share This