New York, California pension leaders oppose 'extreme' SpaceX control structure
1–10 of 139 posts
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#2This is subjective, there are companies that are mostly an investment vehicle and companies that have a strong motivation to make changes in the world. Investors, especially passive investors like pension funds that are only interested in returns, should know in advance what they are getting into and decide if they want to buy shares or not; it should not be "I will buy shares and try to change the company".
I worked for a company where activist investors bought enough shares to have influence, then practically messed up with the company in a way that today, 10-15 years later, the company is a shadow of what it used to be - fell from top positions in Fortune 500, share price is lower in inflation-adjusted money, management is extremely politized and unprofessional, most professionals left or retired. I don't think this is what we want from SpaceX, in the end this is the company that moved the needle in space launches and cost per launch/kg, it's not a ketchup company that not too many people will cry about.
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#3This is subjective, there are companies that are mostly an investment vehicle and companies that have a strong motivation to make changes in the world. Investors, especially passive investors like pension funds that are only interested in returns, should know in advance what they are getting into and decide if they want to buy shares or not; it should not be "I will buy shares and try to change the company". I worked…
> there are companies that are mostly an investment vehicle and companies that have a strong motivation to make changes in the world.
And there are companies that are mostly an investment vehicle whose leaders spin their self-serving decisions as necessary to make changes in the world. Some of them might even be right! (that their decisions are better in the long run, and that ceding more control to shareholders would lead to better short term outcomes but far worse long term outcomes).
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#4This is subjective, there are companies that are mostly an investment vehicle and companies that have a strong motivation to make changes in the world. Investors, especially passive investors like pension funds that are only interested in returns, should know in advance what they are getting into and decide if they want to buy shares or not; it should not be "I will buy shares and try to change the company". I worked…
> it should not be "I will buy shares and try to change the company".
it should not be “I will go public and try to stop the public from exercising their rights as shareholders”...just stay private.
Or, if those business owners want to retain their right to make all the decisions, they should structure the shares like Meta or Alphabet.
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#5[deleted]
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#6Same article syndicated on msn.com, without paywall:
https://www.msn.com/en-us/money/companies/new-york-californi...
The issues:
> The New York and California pension systems would become holders of SpaceX shares through their passive allocations if the company is admitted to major U.S. stock indexes.
> The officials… objected to the amount of power the board has given Musk over the company, including:
- voting control over the stock,
- veto power over his own removal as CEO, and
- protections from litigation, including mandatory arbitration for SpaceX shareholder claims.
> …
> In their letter, the pension leaders urged SpaceX to:
- adopt one-share, one-vote or sunset super-voting shares within seven years;
- install a majority-independent board and separate the CEO and chair roles;
- eliminate provisions protecting Musk from termination without his approval;
- scrap mandatory arbitration; and require independent approval of related-party transactions with Musk's other companies.
(Formatting mine; moved paragraph about becoming holders above the lists of concerns and recommendations.)
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#7This is subjective, there are companies that are mostly an investment vehicle and companies that have a strong motivation to make changes in the world. Investors, especially passive investors like pension funds that are only interested in returns, should know in advance what they are getting into and decide if they want to buy shares or not; it should not be "I will buy shares and try to change the company". I worked…
> it should not be "I will buy shares and try to change the company". it should not be “I will go public and try to stop the public from exercising their rights as shareholders”...just stay private. Or, if those business owners want to retain their right to make all the decisions, they should structure the shares like Meta or Alphabet.
Super voting shares were a mistake to allow in general.
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#8good, pensions should not go into companies where you have no control.
That's not an investment, it's a wealth transfer to original investors at a price they dictate.
without control you can get original founder deciding to build cybertrucks and associating your brand with nazis.
These should not be included in indexes either.
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#9This is subjective, there are companies that are mostly an investment vehicle and companies that have a strong motivation to make changes in the world. Investors, especially passive investors like pension funds that are only interested in returns, should know in advance what they are getting into and decide if they want to buy shares or not; it should not be "I will buy shares and try to change the company". I worked…
> it should not be "I will buy shares and try to change the company". it should not be “I will go public and try to stop the public from exercising their rights as shareholders”...just stay private. Or, if those business owners want to retain their right to make all the decisions, they should structure the shares like Meta or Alphabet.
More like if these funds have an issue with the management structure they should just not buy the shares.
Re: New York, California pension leaders oppose 'extreme' SpaceX control structure
#10This is subjective, there are companies that are mostly an investment vehicle and companies that have a strong motivation to make changes in the world. Investors, especially passive investors like pension funds that are only interested in returns, should know in advance what they are getting into and decide if they want to buy shares or not; it should not be "I will buy shares and try to change the company". I worked…
As investors for other people, the pension funds, have a fiduciary responsibility to ask questions. I don't care if Space X is changing the world or making potato chips for consumers.
If you read the article, they have concerns about the governance structure of Space X and the ability of investors to question what the company is doing.