General Motors and electric vehicle startup Nikola announced plans to form a partnership back on Sept. 8th. At the time the two companies stated the deal, which included GM taking an 11-percent stake in the startup, would close on Sept. 30th. It’s now October and GM has confirmed the deal hasn’t closed.
The original deal stated that GM would help Nikola with the engineering of its Badger pickup truck, including providing its Ultium batteries and manufacturing for the pickup. In exchange, GM would get an 11-percent equity stake in Nikola, which at the time equated to about $2 billion.
Well, a lot has happened since the announcement. Days after the announcement Hindenburg Research, an investor into Nikola, issued a brutal report suggesting that Nikola and founder Trevor Milton engaged in fraud regarding claims on Nikola’s supposed battery technology. This launched official probes by the U.S. Department of Justice and the Securities and Exchange Commission. Then Milton stepped down from the company, leaving former GM board member Stephen Grisky to take his place.
All of this drama has caused Nikola’s stock to tank since the announcement, diminishing GM’s alleged $2 billion in equity to less than half.
GM says the company is still in talks with Nikola about finalizing the deal, but has declined to offer any specifics surrounding timing.