Tesla, an electric carmaker working toward long-term profitability, named board member Robyn Denholm as its chairwoman after a deal with the Securities and Exchange Commission forced mercurial founder Elon Musk to give up the role.
Denholm, the chief financial officer and head of strategy at Australian telecom firm Telstra, had served on Tesla’s board since August 2014 and was the chairwoman of its audit committee. She was paid $4.92 million for the roles last year, most of it in stock options. Her new appointment is effective immediately, Tesla said Thursday.
“I believe in this company, I believe in its mission and I look forward to helping Elon and the Tesla team achieve sustainable profitability and drive long-term shareholder value,” said Denholm, who is relinquishing her role at Telstra in order to handle her expanded duties at Tesla. She previously held executive positions at Juniper Networks and Sun Microsystems and worked for Toyota’s Australian business.
Tesla, which has climbed 13 percent so far this year, has nonetheless given up the highs it reached in the immediate aftermath of Musk’s August statements on Twitter that he had obtained funding to take the company private at $420 a share, a substantial premium to its stock price at the time.
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The proposal, which was later abandoned, disrupted markets and harmed people who bought the stock based on the CEO’s comments, the SEC said in a subsequent lawsuit. Settling the matter not only required Musk to relinquish the role of chairman, he and Tesla had to pay $20 million each.
The agency at first sought to remove Musk as a company officer, too, a move that analysts said might prompt investors to back away and lenders to be unwilling to extend credit.
“Historically, Tesla has had easy access to capital markets, largely due to the public’s perception of Musk as a visionary,” Colin Langan, an analyst with the Swiss lender UBS, said at the time. “Without Musk, investors may no longer be willing to continue funding a company that has never reported an annual profit.”
Shares of Tesla, which posted net income of $311.5 million in the three months through September, its first quarterly profit in two years, climbed 0.9 percent in New York trading on Thursday to $351.40. The company expects to deliver a profit in the last three months of the year as well, Musk told investors in late October.
During the next six months, as Denholm serves out a six-month notice period at Telstra, Musk will provide whatever support she requests at Tesla.
“Robyn has extensive experience in both the tech and auto industries, and she has made significant contributions as a Tesla board member over the past four years in helping us become a profitable company,” Musk said in a statement. “I look forward to working even more closely with Robyn.”
