Nikola, a company that makes electric trucks, is looking to sell its entire business as soon as April, according to its lawyers who spoke during a court hearing about the company’s bankruptcy in Delaware. The lawyers mentioned that Nikola already has at least three potential buyers, although they did not reveal their names. The company plans to reach out to more interested parties and expects to set a deadline for bids around the end of March.
If Nikola is unable to find a buyer for the whole business, it will start selling off its individual assets to pay off its debts, which exceed $1 billion. Nikola claims it has assets valued between $500 million and $1 billion.
This court hearing took place just one day after Nikola filed for Chapter 11 bankruptcy protection, which means it is seeking legal protection from creditors while it tries to reorganize or sell the business. This filing also marks the end of an era for Nikola, a company that has faced a lot of challenges, especially after its founder, Trevor Milton, was found guilty of fraud.
Nikola has been trying to find a buyer for several months. In a statement made under oath, CEO Stephen Girsky explained that the company had previously worked with investment bank Goldman Sachs to approach 22 potential buyers in the truck manufacturing and transportation sectors. Two international car manufacturers showed interest, but one backed out, and the other eventually did too after some negotiations.
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After these attempts failed, Nikola sought help from a law firm to reach out to 24 financial investors, looking for interest in either a full investment or a partnership. However, the feedback indicated that it would take too much money to turn Nikola’s struggling business around.
In December 2024, Nikola had discussions with another international vehicle manufacturer about a possible acquisition, but that deal also fell through after extensive evaluations, which Girsky described as disappointing.
Now that Nikola is in bankruptcy, Girsky told the court they are actively talking to at least three parties interested in buying the entire company. They are also looking to sell some of their most valuable assets, including a factory located in Coolidge, Arizona.
Chazz Coleman, one of Nikola’s lawyers, expressed optimism that the bankruptcy process and the sale would proceed smoothly. Nikola plans to continue seeking interest from potential buyers until around March 27, which is when they hope to set a deadline for bid submissions. If all goes well, an auction could happen around March 31, with a hearing on any potential sale expected in the second week of April, followed by a closing of the transaction shortly thereafter.
During the hearing, it was noted that interest from potential buyers has increased since Nikola filed for bankruptcy. Bankruptcy judge Thomas Horan acknowledged that filing for bankruptcy can clarify the market situation.
There was little disagreement during the hearing, mainly focusing on how quickly the bankruptcy case should progress. Nikola wants a fast process because it only has about $47 million in cash left. On the other hand, Timothy Fox, an attorney from the U.S. Trustee’s Office, expressed the need for sufficient time to meet with Nikola’s creditors.
While no decisions were made during this hearing regarding the timeline, Nikola received unexpected support for a quick process from a group of shareholders who had sued the company over four years ago. These shareholders were recently granted class-action status and had agreed to settle their lawsuit just before Nikola filed for bankruptcy. Their claim is now one of the largest in the bankruptcy proceedings, totaling around $13 million.
Joe Barsalona, a lawyer for the class-action shareholders, emphasized the urgency of the situation, stating that given Nikola’s dwindling cash reserves, it is crucial for the case to move quickly. He likened the situation to a “melting ice cube,” highlighting the pressing need for a resolution.
