Whenever a high profile couple is involved in the divorce process, complex asset division may be required as part of a high asset divorce. Tesla founder and billionaire Elon Musk and his wife, actress Tallulah Riley, are divorcing. Riley filed for divorce in California and is seeking spousal support. Musk is valued at $13.2 billion and a prenuptial agreement was not mentioned. In her divorce filing, Riley requested that she be permitted to provide a list of the couple’s assets at a later date, as the extent of the marital property shared by the couple, as well as the couple’s obligations, were not known.
The divorce filing focused on spousal support, property division, property valuation, tax implications and other divorce-related financial concerns. This is the second divorce for the couple who were previously married in 2010 and divorced in 2012. At the time, Musk was valued at $680 million and Riley received $4.2 million, a Tesla vehicle and jewelry items in the first divorce settlement. The couple remarried in 2013, during which Musk earned $2.9 billion thanks to the success of Tesla.
Musk has already filed for divorce during the couple’s second marriage in 2014. At the time, he agreed to give Riley $16 million, as well as other assets, and there was a mention of a prenuptial agreement and dividing other assets according to the prenuptial agreement. Musk later withdrew the divorce filing 7 months later. The couple did not have any children but Musk has 5 sons from a previous marriage.
Provided there is no second prenuptial agreement to go along with the second marriage, which is unclear, experts estimate that Riley may be entitled to billions of dollars in a divorce settlement. When a divorcing party owns a company, divorce can impact it any many ways. Divorce can impact the ownership of a company and also influence a sale or transfer of a portion of the ownership stake in the company and have other impacts as well.
Because California is a community property state which means, in general, that money made during marriage is shared between the couple, the divorce process, especially a high asset divorce situation, can impact the couple’s assets, business and additional financial concerns. It is important for couples considering divorce, especially couples involved in a high asset divorce, to be familiar with the divorce process and its implications for personal and business assets to better address those concerns throughout.
Source: Town & Country, “Elon Musk’s Divorce Could Cost Him Billions,” March 25, 2016