(Reuters) – U.S. electric-truck maker Nikola Corp ‘s (O:NKLA) founder Trevor Milton has stepped down as executive chairman, the company said on Sunday, as it battles allegations from a short-seller that it misled investors and automakers.
“The focus should be on the Company and its world-changing mission, not me. So I made the difficult decision to approach the Board and volunteer to step aside as Executive Chairman,” Milton said.
Stephen Girsky, a former vice chairman of General Motors Co (N:GM) and a member of Nikola’s board, has been named as the chairman, effective immediately.
In a scathing report earlier this month, short-seller Hindenburg Research alleged that Nikola misled investors over its technology, sending the company’s shares spinning lower.
Hindenburg had said it had gathered enough evidence to show that Milton made false statements about possessing proprietary technology to form partnerships with large automakers.
Nikola rejected the accusations and threatened to take legal action against the short-seller.
Two days before the Hindenburg report came out, GM said it had taken an 11% stake in Nikola for about $2 billion and agreed on a partnership to make electric pickup trucks to take on Tesla Inc (O:TSLA).
Nikola is relying on California-based manufacturer Romeo Power Technology to make batteries for one of its prototype electric trucks, months after touting its own “game-changing” battery, the Financial Times reported last week. (https://on.ft.com/32Qobsx)
The U.S. Securities and Exchange Commission (SEC) is probing Nikola to assess the merits of short-seller Hindenburg’s allegations, according to a Bloomberg News report last week.
Nikola said at the time it had briefed the SEC on concerns pertaining to the report.
The U.S. Department of Justice has also been probing the claims made in the report, the FT said last week.