Nikola Accelerates Sale Plans in Bankruptcy Proceedings
Electric truck manufacturer Nikola is racing against time to sell its entire business by April, according to statements made during its first bankruptcy hearing in Delaware. Company lawyers revealed that at least three unnamed buyers have already expressed interest, with a bid submission deadline tentatively set for late March.
Key Developments in Nikola’s Bankruptcy Case
- Dual-Path Strategy: Nikola will pursue either a complete business sale or piecemeal asset liquidation to address over $1 billion in liabilities
- Asset Valuation: The company estimates its assets between \(500 million and \)1 billion
- Timeline: Potential auction scheduled for March 31, with final sale approval possible by mid-April
From Fraud Scandal to Financial Collapse
The bankruptcy filing marks a dramatic fall for Nikola, which has struggled since its founder Trevor Milton was convicted of securities fraud. Court documents reveal the company had been actively seeking buyers for months before filing for Chapter 11 protection.
Failed Acquisition Attempts
- Goldman Sachs Partnership: Nikola engaged with 22 potential acquirers in truck manufacturing and logistics
- International Interest: Two automotive manufacturers initially showed interest before withdrawing
- Investor Outreach: 24 financial investors declined, citing excessive turnaround costs
Current Sale Prospects and Challenges
CEO Stephen Girsky disclosed that Nikola is now in active discussions with three potential buyers. High-value assets like the Coolidge, Arizona factory are being marketed separately to maximize value.
Bankruptcy Court Dynamics
- Cash Reserves: Nikola has approximately $47 million remaining
- Creditor Concerns: U.S. Trustee’s Office seeks adequate time for creditor consultations
- Unexpected Support: Class-action plaintiffs (owed $13 million) advocate for rapid resolution
“We believe it is a melting ice cube,” stated Joe Barsalona, representing shareholders, emphasizing the urgency of the sale process.
What’s Next for Nikola?
With bid submissions due by March 27 and potential auction dates in late March, all parties agree on the need for speed. As bankruptcy judge Thomas Horan observed, the filing has “crystallized the market” for potential buyers.
The coming weeks will determine whether Nikola finds a lifeline through acquisition or becomes another cautionary tale in the volatile EV startup landscape.
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