Tech billionaire’s company Elon Musk announced on Friday after the US market close that its board of directors will agree to a three-for-one split if approved by stockholders at the upcoming AGM. Tesla had already announced in March that it was planning a split. But it was unclear in what proportion.
Stock splits don’t actually change a company’s market value, but they do lower the price per share. The paper can thus become more attractive, especially for small investors, even if many brokers are already offering to buy shares in part. Nevertheless, the measure is very popular with companies: this year, other large US corporations such as Google’s parent company Alphabet and Amazon announced stock splits.
Tesla’s shares had recently come under a lot of pressure in the general downturn on the stock markets. Since the highs of last November, the price has fallen by more than 40 percent. Tesla shares closed at $696.69 on Friday. The announcement of the share split initially led to slight price gains after the market. Tesla also announced in the announcement that Oracle founders Larry Ellison would like to give up his position on the board of directors.
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