Electric truck maker Nikola may do reverse stock split to prevent delisting

Electric truck maker Nikola may move to prevent the Nasdaq from delisting its shares.

A reverse stock split is being considered to meet the minimum bid price requirement over a period of time, said CEO Michael Raescherer.

Nikola stock closed Thursday at about 57 cents.

The company is dealing with rising losses, burning large amounts of cash and sluggish demand for its battery-powered trucks.

Jaguar recalls I-PACE electric vehicles due to battery fire hazard

Nikola Corp. Tre FCEV truck unveiled at the IAA Transportation show in Hannover, Germany. (Christian Bosi/Bloomberg via Getty Images/Getty Images)

The company received a delisting notice from the Nasdaq last week.

The Nasdaq requires stocks to trade above $1 and sends a notification if the stock trades below that mark for 30 consecutive business days.

A company must trade above $1 for at least 10 consecutive days within a 180-day period to comply with the rule, but a second 180-day period will be allowed if it meets other requirements.

Falling prices: People are buying below MSRP on new cars again

Nikola logo on truck grill

The Nikola logo was photographed at an event held to unveil CNH’s new all-electric and hydrogen fuel cell trucks in partnership with Nikola Events in the United States. (Reuters/Massimo Pinca/Reuters photo)

A reverse stock split consolidates existing shares into a smaller number of shares.

“We believe we can restore Nasdaq compliance and will work to ensure that Nikola common stock is not delisted,” Roescherer said in a webcast answering shareholder questions.

The stock rose 1% in extended trading.

Rivian beats earnings estimates on high-end EV sales

Nikola factory

A Nikola Tre battery-electric heavy-duty truck at the joint-venture electric truck plant of Nikola Corp. and Iveco SpA in Ulm, Germany. (Andreas Geber/Bloomberg via Getty Images/Getty Images)

“As we navigate through difficult times, we have to make difficult decisions,” Rascheler added.

ticker safety last change change %
NKLA Nicola Co., Ltd. 0.57 -0.05 -7.98%

The chief executive on Thursday called on shareholders to vote in favor of increasing the number of shares the company can issue at its annual meeting next week.

Reuters contributed to this report.

Leave a Reply

Your email address will not be published. Required fields are marked *