Trevor Milton loses billionaire status as Nikola stock hits 52-week low

It is unlikely Miltion exercised any of the options for himself because he sold 3.5 million shares on March 31, collecting $49 million at $13.89 a share. 

Another threat looms

Nikola shares face another pressure point April 30 when an extended lockup on early investors and board members expires. That allows them to sell up to about 74 million shares. Milton was allowed to begin selling his 91.6 million shares on Dec. 6. He has sold about 11 million shares, including the most recent disposal. 

If another selloff happens, Nikola may need to upsize a planned secondary stock offering. The company registered to sell shares in March. CEO Mark Russell told FreightWaves it would happen within the next 12-18 months. The offering would exceed the $100 million placeholder on the SEC filing.

Most of Nikola’s cash on hand is dedicated toward building an assembly plant in Coolidge, Arizona, where production of Nikola Tre cabover Class 8 trucks is expected to begin this quarter. The model based on the IVECO S-Way initially will be assembled from kits imported from Ulm, Germany, where Nikola and IVECO have a manufacturing joint venture.

It needs more money to build its first hydrogen fueling station, also in Arizona, this year.

Milton down to hundreds of millions

Milton, once a regular and sometimes combative regular on Twitter and in business media, has been silent since resigning from Nikola last September. He could not be reached for comment Friday through his spokespeople. The company declined comment for this story.

Though certainly rich by any reasonable measure, Milton’s net worth has plummeted with Nikola’s stock price. He was listed among the dozen youngest billionaires on the Forbes 400 in September 2020 when his shares were worth $3.3 billion. Forbes this month included Milton in its Top 10 of SPAC billionaires. He was No. 9 at $1.1 billion.

Based on Friday’s closing price of $10.98, Milton’s stake is worth about $868.3 million.

The long fall

When Nikola shares closed Thursday at $10.63, it was the lowest since the company went public in a reverse merger with special purpose acquisition company (SPAC) VectoIQ last June. 

Prior to the business combination, Nikola shares traded under the ticker VTIQ. They moved little from their $10.00 per share price until the merger neared. A few days after its NASDAQ listing, shares traded intraday at $93.99, briefly eclipsing the valuation of 118-year-old Ford Motor Co. (NYSE: F).

The stock has generally been in decline since, buffeted by waves of bad news, canceled business deals and delays in keeping promises Milton made.. 

The worst and most sustained hit followed a report by short seller Hindenburg Research last September that claimed Milton lied about the company’s early achievements and technology prowess. Nikola conducted an internal investigation and reported that Milton had made nine statements included in the Hindenburg report that were partially or wholly untrue.

Related articles:

Second major partner cuts stake as Nikola plans $100M sale of new shares

News analysis: Nikola tormentor Hindenburg Research opens fire on Lordstown Motors

No partners, no problem: Nikola may do hydrogen stations solo

Click for more FreightWaves articles by Alan Adler.