Company founder and Executive Chairman Trevor Milton has resigned from Nikola Corporation following a scandalous report from short sellers that has reportedly triggered an SEC investigation. Milton’s resignation comes less than two weeks after the company announced a $2 billion USD deal with General Motors.
Taking the spot of Milton is Stephen Girsky, a former vice chairman of General Motors and a member of Nikola’s board, effective immediately.
The official statement from Trevor Milton is pictured below.
Triggering this fallout was a report from Hindenburg Research accusing Milton of making false statements about the company’s technology to attract investors and partnerships with other automakers, along with exposing various leaders of the company as being under-qualified, at best The report was released just two days after the company announced a deal with GM that sent both companies’ shares soaring. All gains have since been erased, while Nikola is trading at its lowest price since the company went public.
According to CNBC, GM said it will “work with Nikola to close the transaction we announced nearly two weeks ago to seize the growth opportunities in broader markets” with its battery electric and fuel cell technologies. As part of the $2 billion equity deal with Nikola, General Motors would engineer and build the Nikola Badger pickup, and would license its fuel cell and battery technology to the Phoenix-based automaker.
In hindsight, the red flags were part of the agreement. Because if Nikola had the groundbreaking fuel cell technology it so promised, why would it need to license fuel cell IP from General Motors? And why would GM go through the trouble of developing the Nikola Badger pickup truck when it’s planning an arsenal of electric pickup trucks like the 2022 GMC Hummer EV and Chevrolet Silverado EV on its own? Maybe we’ll understand more in due time. Or maybe GM didn’t actually practice the due diligence that it claimed to.