Tesla sets August 25 as the three-to-one trading day

(Reuters) – Trading in its three-for-one split shares will begin August 25, Tesla Inc. said on Friday, after shareholders of the electric car maker approved the proposal at its annual meeting.

The electric car maker’s shareholders voted in favor of board recommendations on most issues at the company’s annual meeting on Thursday, including the re-election of board members and approval of a stock split, while rejecting proposals focused on environment and governance.

CEO Elon Musk owns 15.6% of Tesla, according to Refinitiv data, after selling millions of shares last year.

Each shareholder registered on August 17 will receive a cash dividend of two additional shares for each share owned, to be distributed after trading closes on August 24, the company said.

The new stock split comes two years after a five-for-one stock split that helped keep the share price volatile within the reach of ordinary investors.

While a split does not affect the company’s fundamentals, it can boost the stock price by making it easier for a larger group of investors to own the stock.

Shares of Tesla, which debuted at $17 a piece in 2010, soared to more than $1,200 late in the year after a 2020 stock split, bringing the company’s market value to more than $1 trillion.

Shares of Tesla, which closed down 6.6% on Friday, are down about 18% this year.

At Thursday’s meeting, shareholders narrowly approved an advisory proposal that would increase investors’ ability to nominate directors, with 339.2 million votes in favor of the proposal and nearly 319 million votes against.

The shareholder’s motion requiring Tesla to report on its efforts to prevent racial discrimination and sexual harassment annually was rejected, with 350.7 million votes against and 310 million for the motion.

(Reporting by Yuvraj Malik in Bengaluru; Editing by Maju Samuel)