Key Events

👉 Tesla’s Incorporation In Texas

Tesla’s board of directors has approved the incorporation of the company in Texas. Delaware corporations are allowed to move their incorporation to another state if the move is approved by the board of directors and the majority of shareholders.

But why does Musk want to move to Texas?

Delaware law protects minority shareholders from the actions of the majority like Elon Musk. For instance, it protected the shareholders from Musk’s $56 billion pay package.

Musk does not want this drama to ensue again and therefore wants to move to Texas. However, since incorporation in Texas will affect minority shareholders, Delaware law is likely to prevent Tesla from doing this.

How might Musk affect the minority shareholders? He owns six companies and treats them as his private property, shifting resources, employees, and chips from one to another—he does not follow corporate formalities.

Nonetheless, shareholders seem to believe that this is a good idea. It is possible that Texas corporate law protects shareholders in the same way as Delaware law, meaning that the move might be a pure coincidence.

Investors may feel that Delaware law is too protective of minority shareholders. Musk has created enormous value for shareholders. Investors who bought Tesla when it was valued at $60 billion saw Musk take it to $1.2 trillion. Maybe Delaware law puts the interests of disgruntled investors over those of economically motivated shareholders.

👉 Bond Markets Spooked By French Election

Polls for the snap election in France suggest that the populist far right, with its high-spending agenda, could emerge victorious. Why does this matter?

The French government is heavily indebted and running a fiscal deficit—it was downgraded by S&P Global last month. If France continues down this path, it could face a situation similar to that of the UK.

In 2022, when Liz Truss became Prime Minister, her attempt at tax cuts widened the government deficit, increasing the risk of default and causing bond yields to surge as investors fled.

This week, French 10-year bond yields surpassed those of Portugal and have caught up with Spain.

Mergers and Acquisitions

Kirin Holdings agreed to buy Fancl, a maker of cosmetics and dietary supplements, for more than $1.4B.

Initial Public Offerings

Launch One Acquisition, a health care SPAC, filed for a $200M IPO.

Venture Capital

Findigs, a rental screening startup, raised $27M in Series B funding.