An Australian telecom executive, the leader of a cosmetics company, and the former finance chief of Elon Musk’s solar-power company are now in charge of deciding Tesla Inc.’s fate.

The board of the electric-car maker formed a special committee to evaluate the chief executive officer’s proposal to take the company private, a day after he revealed more on who will advise him and help fund the potential deal. Directors Brad Buss, Robyn Denholm and Linda Johnson Rice will constitute the committee, which hasn’t received a formal proposal from Musk, according to a Tesla statement Tuesday. They haven’t reached any conclusion on whether taking the company private is advisable or feasible.

Musk, 47, set off a firestorm a week ago with his highly unconventional announcement of the effort to take a company off the public markets and has been drip-feeding details in tweets and blog posts that have preempted Tesla’s board. The chairman and largest shareholder wrote late Monday that he’s getting advice from Goldman Sachs Group Inc. and private-equity firm Silver Lake and has lined up legal advisers. Earlier in the day, he said Saudi Arabia first approached him with interest in helping take Tesla private early last year.

Musk has said in blog posts that Tesla being a public company has forced them to focus on short-term decisions that aren’t right for their long-term goals, and that he thinks going private would allow the company to operate at its best.

“The bears are dug in, the bulls are dug in, and so the public markets aren’t really functioning properly, or as they should,” James Albertine, an analyst with a buy rating on the shares, said Tuesday on Bloomberg Television. Private stakeholders would be able to “share in that long-term view with Elon and it would be a lot less volatile.”

Tesla shares were little changed at $356.50 as of 11:30 a.m. Tuesday in New York. The stock remains well below the $420 level at which Musk has said existing shareholders could be bought out if they choose, underscoring investor skepticism that the deal is doable.

While Tesla considers Buss to be an independent director, major proxy advisory firms Institutional Shareholder Services and Glass Lewis don’t because he served as the chief financial officer of SolarCity Corp. before Tesla acquired the company in 2016.

Denholm is the chief operating officer of Telstra Corp., Australia’s largest telecommunications company. Rice, chairman of Johnson Publishing Co., long known for Ebony magazine, is one of the two newest directors on the board. Tesla appointed her and James Rupert Murdoch, the CEO of Twenty-First Century Fox Inc., to the board in July 2017. Johnson Publishing sold Ebony in 2016, retaining its Fashion Fair Cosmetics business.

With Musk recused, brother Kimbal Musk not independent and director Stephen Jurvetson on leave, the board had only six members to choose from for its committee. Lead director Antonio Gracias, who is chief investment officer of Valor Equity management, would presumably have been eligible, along with Murdoch and venture capitalist Ira Ehrenpreis.

The Tesla board’s special committee has hired Latham & Watkins LLP for legal counsel and plans to retain an independent financial adviser to assist its review, according to the statement. The company has separately retained Wilson Sonsini Goodrich & Rosati for legal counsel.

Read or Share this story: