New Nikola Shares Blocked by Founder and Former CEO

CNBC reports:

Electric truck maker Nikola once again fell short of winning shareholder approval to raise new funds, the company said Monday. The measure has so far been blocked by the company’s since-departed founder.  

In a brief webcast Monday, Chairman Steven Girsky said that while the vote on the proposal to issue new shares is closer than it was a few weeks ago, the tally is still shy of the 50% of outstanding shares needed to pass. The meeting is adjourned until Aug. 2.

Nikola’s shares were roughly flat in after-hours trading after the meeting concluded.

Nikola is seeking to raise money by issuing new stock, a process that requires shareholder approval. The company’s June 1 annual shareholders’ meeting was adjourned after its founder and former CEO and chairman, Trevor Milton, voted against the proposal. The meeting briefly resumed on June 30, only to be adjourned again as the proposal still didn’t have the votes to pass.  

Milton left the company amid allegations of fraud in 2020, but he remains Nikola’s largest shareholder. He owns 11% of the company’s stock outright and controls about 9% more via an investment vehicle that he co-owns, giving him control of about 90 million shares of Nikola stock.  

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