WILMINGTON, DE, July 14 – Elon Musk fired a friendly shot across the bow of Tesla Inc’s (TSLA.O) board when he declared in a Wilmington courtroom that he’s tried to not be the CEO, but that without him the company could not survive.
Mr. Musk’s surprising remark came as the first day of testimony was wrapping up on June 12. Musk was testifying to defend his role in Tesla’s 2016 $2.6b controversial all-stock acquisition of solar panel company SolarCity.
The lawsuit asserts that Mr. Musk overcame his minority shareholder status to inappropriately use his close ties to board members and his dominating personality to push the board of directors to deplete Tesla’s assets in the deal for SolarCity.
The lawsuit claims that Mr. Musk strongarmed Tesla to overpay and that he wasn’t forthright with shareholders regarding the solar panel maker’s deteriorating financial condition.
Mr. Musk owned an estimated 22% share in both Tesla and SolarCity at the time of the transaction. Some Tesla shareholders charge that Musk’s end game was to bail out his personal investment SolarCity.
The shareholders are asking the court to make Mr. Musk repay Tesla all the money that the company invested in the SolarCity deal.
Mr. Musk testified that the board negotiated the terms of the merger and that he was not a participant in the board committee that handled negotiations. “I don’t even know what happened,” he claimed.
Musk denied benefiting from the merger because it was an all-stock deal and no cash changed hands. He said that he had aimed to strategically combine Tesla’s cutting-edge battery technology with SolarCity’s capabilities.
Board members, other involved parties, and Musk will testify before the conclusion of the two-week trial. A ruling isn’t expected for several months.
This hasn’t been the first time Musks business decisions have come to question.