General Motors is considering taking a larger stake in controversial EV startup Nikola, insiders say Bloomberg. Due to the fuss around Nikola, the value of the company has fallen considerably. GM now owns 11 percent of the company, but the deal is reportedly under scrutiny.
Following the fuss surrounding Nikola, GM wants to close the deal better, according to insiders involved in the talks. The agreement currently on the table is that GM will acquire 11 percent of the shares in Nikola and appoint someone to the start-up’s management. In return, GM helps design and build the Badger, Nikola’s electric pickup truck. GM will also supply powertrains to Nikola. Now, however, Nikola’s negotiating position has deteriorated considerably. GM therefore wants to remove better conditions from the agreement. The deadline for finalizing the agreement is December 3rd.
The conversations can be conducted in several ways. GM may demand a larger stake in Nikola, which is an obvious step given the company’s declining value. Additional guarantees can also be built into the deal. Those guarantees could mean, for example, that GM acquires a larger stake as Nikola becomes more successful. Incidentally, Nikola announced this week that the unveiling of the Badger will be postponed. What the deal between Nikola and GM will definitely look like will be revealed later. Apparently the large concern still sees the point.