Nikola Founder Steps Down
Nikola’s stock price fell nearly 20% yesterday after news broke that founder Trevor Milton will be leaving the company. He was accused of misleading investors on the readiness and proprietary nature of the company’s technology. The company’s stock price is down 45% since the initial report levelling these accusations was released.
Milton claims the allegations are false, but that he is stepping down to let Nikola focus on business rather than distractions. He has been known for his outspoken nature during his time first as CEO then as executive chairman. A quarter of the company is still owned by him.
Former GM executive and current Nikola board member Stephen Girsky will take over as executive chairman effective immediately. Some of his first duties will be navigating the SEC and Justice Department investigations into whether Nikola misled investors.
Girsky’s former company, GM, released a statement that it’s committed to maintaining its partnership with Nikola. The two companies announced a deal earlier in the month to collaborate on battery and hydrogen fuel-cell vehicles.
The new leadership raises many questions about the future of Nikola. Will the company move in a new direction or maintain its course? Were the misleading statements of the past isolated to Milton or part of a larger issue? Investors will be watching Nikola closely to learn answers.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.