GM delays Nikola deal closing date after stock price tumbles

The Nikola One

General Motors has announced that it will push back the closing date on its partnership with automaker Nikola Corporation. The partnership has most likely been delayed after Nikola’s stock price has fallen significantly after a report indicated that the automaker could have misled shareholders.

“Our transaction with Nikola has not closed,” a GM statement issued on Tuesday said. “We are continuing our discussions with Nikola and will provide further updates when appropriate or required.”

GM still has intentions to complete a deal even though Nikola is facing serious allegations of fraud.

The deal between the two companies was expected to close on Wednesday. It saw a massive, 10-year contract that would allow GM to share technology and parts with Nikola. GM would receive stock and other cost savings in exchange.

However, it is evident the originally-planned September 30th closing date is not going to be upheld. GM has the option to terminate the partnership if a deal has not been closed by December 3rd, 2020.

NKLA stock was trading as high as $50.05 in September until it crashed and dropped by nearly 40% after Hindenburg Research released a lengthy report stating that the automaker was partaking in fraudulent practices. Among the report, details that included a fake demonstration of one of Nikola’s semi-trucks was one of many ways that the company had misled shareholders.

NKLA’s price per share has tumbled over 60% since its monthly high, and at the time of writing was trading at $18.09.

Since the allegations have come out, Nikola founder and Chairman Trevor Milton has stepped down from his post, deleted his social media accounts, and has been relatively silent in the public eye. Allegations continue to come out about Milton’s conduct, and CNBC reported yesterday that two women had filed sexual abuse complaints against him.

Milton handed over around $166 million of equity and a two-year, $20-million consulting contract, the Detroit Free Press reported. However, he kept $3.1 billion in stock, according to the SEC, and it is unknown what he will do with his holdings.

Joey Klender: Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his time at TESLARATI, Joey has broken several big stories, including the first images of the Tesla Model S Plaid, the imminent release of the 4680 Model Y through EPA certification, and several expansions to the Lucid AMP-1 factory in Arizona, to name a few. His stories have been featured in several publications, including Yahoo! Finance, Fox News, CNET, and Seeking Alpha. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at He is also on Twitter @KlenderJoey.
Related Post
Disqus Comments Loading...