Nikola Falls; SEC Said to Examine Truck Maker After Short Report

Marco Green
September 16, 2020

Questions arose after Hindenburg Research published a report alleging "intricate fraud" at the company, which it alleged misled investors over its technologies. As its stock tumbled last week after the release of the short seller report, the Phoenix-based company said it reached out to the SEC to discuss its issues with the Hindenburg report, and ultimately held a call with agency officials on the morning of September 11.

Nikola had inked a $2 billion deal with General Motors just days before the report, sending its market value soaring more than 40%.

Nikola Corp. fell in U.S. pre-market trading after Bloomberg News reported that the U.S. Securities and Exchange Commission is examining the company to assess the merits of a short-seller's allegations that the electric-truck maker deceived investors about its business prospects.

Nikola, which had accused Hindenburg of manipulating the stock to benefit short-sellers, said its counsel had contacted and briefed the SEC on its concerns regarding the short-seller's report.

SEC spokeswoman Judith Burns declined to comment.

In the lengthy report, Hindenburg said it had "gathered extensive evidence - including recorded phone calls, text messages, private emails and behind-the-scenes photographs - detailing dozens of false statements by $NKLA Founder Trevor Milton", adding: "we have never seen this level of deception at a public company".

"Obviously, the truck can't have 1,000 horsepower or even 1 horsepower if it doesn't power itself", Hindenburg said in the new report.

Bloomberg reported Monday that the USA agency was examining the company to assess the merits of accusations made by short-seller Hindenburg Research.

"Nikola believes that the Hindenburg report, and the opportunistic timing of its publication shortly after announcement of Nikola's partnership with General Motors Co. and the resulting positive share price reaction, was created to provide a false impression to investors and to negatively manipulate the market in order to financially benefit short sellers, including Hindenburg itself", Nikola said in its rebuttal issued Monday.

Other reports by Click Lancashire

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