Important points
- Elon Musk’s net worth soared to $749 billion after his shareholder-backed pay deal was upheld.
- The Delaware Supreme Court reversed an earlier decision and found that Musk had met the milestones required for the huge stock-based compensation.
Elon Musk just got richer. A lower court ruling that invalidated the Tesla CEO’s 2018 compensation package was overturned by the Delaware Supreme Court on Friday, increasing his net worth to $749 billion, according to Forbes magazine.
The decision effectively restored Tesla’s pay package, which is now estimated to be worth about $139 billion, up from its original valuation of about $56 billion due to Tesla’s stock rally.
The lawsuit, filed seven years ago by Tesla shareholders, alleges that Tesla misled investors by approving a compensation plan that gave Musk stock options conditional on him hitting a series of tough financial milestones.
In early 2024, Chancellor Katherine McCormick of the Delaware Court of Chancery ruled against Musk, voiding Tesla’s pay package and saying the approval process was seriously flawed. Finance Minister McCormick later reaffirmed the ruling, despite Tesla’s attempts to cure the defects through a shareholder vote approving a compensation plan.
According to Friday’s ruling, the Supreme Court agreed with the Delaware court that the approval process was seriously flawed, but said invalidating the entire compensation agreement would be an overreaching remedy.
The court noted that Musk had fully met the performance milestones associated with the package and that revoking the package would mean he would no longer receive compensation for six years of service.
The ruling could restore Musk’s voting rights to Tesla and strengthen his control over the company’s strategic direction.
Musk’s fortune recently topped $600 billion, while SpaceX’s valuation reportedly rose to $800 billion. Investors are increasingly optimistic about Musk’s financial future, with hopes rising that he will reach trillionaire status by 2029.
