Short-seller accuses Nikola of fraud after its $2 billion GM deal

CEO Milton took to Twitter to refute the allegations in the report

Shares of electric automaker Nikola - which like Tesla is named after the 19th-century inventor - were down more than 15 percent Friday afternoon after a report from Hindenburg Research accused founder Trevor Milton of lying about his company's tech in order to score a major partnership with General Motors.

GM said on Thursday after the Hindenburg report that it stood by the comments it had made in announcing the alliance and it was "fully confident" in Nikola.

Nikola went on to say the report was a "hit job for short sale profit driven by greed" and they'll "bring the actions of the activist short-seller, together with evidence and documentation, to the attention of the U.S. Securities and Exchange Commission".

The latter is happening as Nikola said "We have retained leading law firm Kirkland & Ellis LLP to evaluate potential legal recourse, including with respect to the activist short seller and any others acting in concert".

One of the biggest claims from the Hindenburg report is the suggestion that Milton's statements during a July 2020 podcast directly indicate that the Nikola Tre was rolling off of production lines at a company facility in Europe. "To be actually very clear, this was actually certainly not a research study record and also it is actually certainly not exact". In reference to earlier pledges to provide a "detail report" to address Hindenburg's claims, he hinted in another tweet that might take time. "It will be released as soon as they give me the green light", he said.

Hidenburg Research's founder, Nathan Anderson, said he welcomed Nikola's pledge to petition securities regulators. "We detailed dozens of misrepresentations by Nikola founder Trevor Milton", the report said.

Tesla CEO Elon Musk has blamed some of the company’s negative issues on short sellers in the past
Tesla CEO Elon Musk has blamed some of the company’s negative issues on short sellers in the past

That set off a two-day plunge in the stock that sent it back below the US$33.75 close on June 4 when it gained its public listing.

"Congrats to Hindenburg for exposing what appears to be a total fraud with $NKLA", Citron tweeted, adding that the short seller will cover half of all legal expenses for Hindenburg.

Nikola Declines as Short Seller Accuses EV-Maker of '.

Nikola was little-known before it went public in early June through a reverse merger with a blank-check company. At one point, Nikola shares had ballooned to nearly $80 a share, giving it a market capitalization greater than Ford Motor Co. despite not generating any meaningful revenue. Hindenburg refers to that story in a portion of its report.

A $14bn Tesla rival developing hydrogen and electric trucks has been accused of misleading investors in an "intricate fraud", just days after General Motors took an 11pc stake in the company. The Detroit titan likewise will definitely deliver fuel-cell and also electric battery modern technology for Nikola's semi vehicles, which result from be actually developed at a manufacturing plant incomplete in Coolidge, Arizona.

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