Electric trucking startup Nikola is hoping to sell what remains of its whole business as early as April, lawyers for the company told a judge Thursday during the first hearing of its bankruptcy case in Delaware.
The lawyers claimed Nikola already has at least three interested buyers (who they did not name) and that the company hopes to solicit other bids, with a submission deadline likely in late March.
If Nikola can’t find a buyer willing to take on the whole business, the company will pivot to selling off its assets in pieces in an attempt to satisfy more than $1 billion in liabilities. (Nikola claims between $500 million and $1 billion in assets.)
The hearing was held just one day after Nikola filed for Chapter 11 bankruptcy protection and announced it would no longer operate as a standalone business, bringing an end to a company that has been plagued with drama after its founder Trevor Milton was convicted on multiple counts of securities fraud.
Nikola had been trying to sell itself for months, some of the early bankruptcy filings and lawyers’ statements show.
In a sworn declaration, CEO Stephen Girsky said Nikola worked with Goldman Sachs and solicited 22 potential acquirers in the truck manufacturing and transportation logistics spaces. Two “international automotive
manufacturers expressed interest” in a transaction, according to Girsky. One dropped out. Nikola also exchanged “various term sheets” with the other until that party also walked away in late 2024.
After that failed, Nikola worked with law firm Houlihan Lokey to solicit 24 financial investors to “gauge potential interest in both a standalone investment and an investment alongside a potential strategic partner.” The feedback, though, was that it would require too much money to turn Nikola’s nascent business around, according to Girsky.
In December 2024, Nikola wound up in discussions with another “international vehicle manufacturing company” about a potential acquisition, going through what Girsky described as “substantial due diligence” over a four-week period. But the prospective buyer “ultimately walked away,” which Girsky noted was a “disappointing conclusion.”
Now in bankruptcy, Girsky told the court Nikola is in “active discussions with at least three” parties interested in buying the company outright, and that they’re also marketing some of its highest-value assets for possible sales, such as the factory in Coolidge, Arizona.
Chazz Coleman, a lawyer representing Nikola in the bankruptcy case, said he expects the case and the sale process to be “uneventful and smooth.”
Nikola will continue to solicit interest until around March 27, the first proposed date for a bid submission deadline, Joshua Morse, another lawyer representing Nikola, said Thursday. Depending on how that process goes, there could be an auction held around March 31. A hearing on any potential sale would likely happen in the second week of April, with the transaction closing shortly after.
Morse also said during the hearing that inbound interest from potential buyers has only escalated since the company filed for bankruptcy protection.
“It does tend to crystallize the market,” bankruptcy judge Thomas Horan replied.
There was minimal disagreement during the hearing, mostly around the speed of the bankruptcy case. Nikola wants it to move quickly because it only has around $47 million in cash. Timothy Fox, a trial attorney for the United States Trustee’s Office, which oversees bankruptcy proceedings, said he wants to make sure he has enough time to meet with Nikola’s creditors.
No decision was made during the hearing on timing, but Nikola found support for a speedy process from an odd party: a group of shareholders that sued the company more than four years ago.
The plaintiffs in that case were granted class action status just last month, and Nikola agreed to settle the lawsuit shortly before filing for bankruptcy. Those plaintiffs have the fourth-largest creditor claim in Nikola’s bankruptcy thanks to that settlement, totaling around $13 million.
Joe Barsalona, a lawyer representing the class action plaintiffs, said Thursday that, given Nikola’s dwindling cash balance, “it is imperative to our client that this case move rapidly.”
“We believe it is a melting ice cube,” Barsalona said.
