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Technology Stocks : Nikola Corp

NKLA 0.184

-0.6%

Feb 25 3:59 PM EDT

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From: Sr K	11/30/2020 2:02:28 PM
	of 252

WSJ General Motors Will No Longer Take a Stake in Nikola Shares in the electric-truck startup slide after companies scale down their supply agreement GM will supply fuel cells to Nikola but it scrapped plans to build an electric pickup truck for the startup. PHOTO: PATRICIA BECK/ZUMA PRESS By Updated Nov. 30, 2020 1:05 pm ET General Motors Co. GM will no longer take an equity stake in electric-truck maker Nikola Corp. NKLA -under a stripped-down agreement revealed Monday, a significant retrenchment from an earlier pact that fueled investor enthusiasm for both companies. Under the revised deal, GM still intends to provide Nikola with fuel-cell technology but it has nixed plans to take an 11% stake in the Phoenix-based startup in exchange for supplying engineering work and other services. The Detroit auto maker has also scrapped plans to build an electric pickup truck called the Badger for Nikola, a key part of an earlier agreement outlined in September. That deal got delayed after a negative short seller’s report raised questions about the readiness of some aspects of Nikola’s business, allegations the company said were false and misleading. The original agreement bolstered Nikola’s status as one of several highflying green-vehicle startups drawing attention from Wall Street. GM’s lending of its engineering and manufacturing expertise, and being granted a spot on Nikola’s board, had been seen as a validation of Nikola’s business model and growth prospects. For GM, the Badger piece of the deal had been seen as a boost for its broader plans to license its electric-vehicle technology, the potential of which has helped lift its share price in recent weeks.

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