The hits keep on coming for Nikola Motors as its partnership with General Motors appears to be on shaky ground after the automaker pushed the closing date back to December.
The partnership between GM and Nikola was announced just three weeks ago, and would see GM “engineer, validate, homologate and build” the Nikola Badger pickup truck. Under the terms of the deal, Nikola would also use GM’s Ultium battery system and Hydrotec fuel cell technology in the Badger and its semi trucks.
In exchange, GM would get a $2 billion equity stake in Nikola based on shares prices at the time. The value of Nikola has plummeted since then after a report from Hindenburg Research called them an “intricate fraud”.
The report eventually led to founder Trevor Milton leaving the company last week, but retaining the majority of his shares.
The massive drop in value, and the recent allegations of sexual assault against Milton, are the likely causes of the delay. GM says it still intends to complete the deal, but is probably looking to shore up its side of the deal and gain more equity. It was originally scheduled to close tomorrow, September 30, 2020.
“Our transaction with Nikola has not closed. We are continuing our discussions with Nikola and will provide further updates when appropriate or required,” GM said in a statement Tuesday.
Nikola (NKLA) shares were down nearly 5% during trading on Tuesday, trading at around $18 per share. Shares were as high as $50 after the deal with GM was announced.
Source: Detroit Free Press