An electric trucking startup, Nikola, is aiming to sell its entire business as early as April, as disclosed by the company’s lawyers during the first hearing of its bankruptcy case in Delaware. The attorneys revealed that Nikola already has at least three potential buyers, though these parties remain unnamed. The company is also seeking additional bids, with a submission deadline potentially set for late March.
In the event that Nikola cannot secure a buyer for the entire operation, the company plans to sell its assets in parts to address liabilities exceeding $1 billion. Nikola currently reports having assets valued between $500 million and $1 billion.
The hearing followed Nikola’s filing for Chapter 11 bankruptcy protection and its announcement to cease operations as an independent business, concluding a tumultuous chapter marked by the conviction of its founder, Trevor Milton, on multiple securities fraud charges.
Bankruptcy filings and statements from the lawyers indicate that Nikola had been seeking a buyer for several months. In a sworn statement, CEO Stephen Girsky detailed that Nikola engaged Goldman Sachs to approach 22 potential acquirers in the truck manufacturing and transportation logistics sectors. Although two international automotive manufacturers showed interest, one withdrew early on, and terms with the second soured by late 2024.
Subsequent efforts involved collaborating with the law firm Houlihan Lokey to engage 24 financial investors in discussions about both standalone investments and partnerships with strategic investors. However, feedback suggested that redeveloping Nikola’s emerging business would be prohibitively expensive.
In December 2024, Nikola engaged in extensive due diligence with another international vehicle manufacturing company concerning acquisition talks, but the potential buyer ultimately opted not to proceed, which Girsky described as a disappointing outcome.
Currently in bankruptcy, Girsky informed the court that Nikola is actively negotiating with at least three entities interested in acquiring the entire company and is marketing some of its valuable assets, including its factory in Coolidge, Arizona, for possible sale.
Chazz Coleman, a legal representative for Nikola in the bankruptcy case, anticipates a smooth and uneventful case and sale process. Another of Nikola’s lawyers, Joshua Morse, reported that interest from potential buyers has increased since the bankruptcy filing. Nikola will continue soliciting interest until around March 27, the proposed bid submission deadline, with an auction possibly occurring around March 31. Any sale would be reviewed in April, and finalized shortly thereafter.
Bankruptcy Judge Thomas Horan noted that filing for bankruptcy often clarifies the market, in response to Morse’s statement on increased buyer interest. Although there was little contention during the hearing, discussions focused on the speed of the bankruptcy process. With approximately $47 million in cash, Nikola is keen for a swift resolution. Timothy Fox, a trial attorney with the U.S. Trustee’s Office overseeing bankruptcy proceedings, requested sufficient time for creditor consultations.
While the hearing did not settle on a timeline, Nikola received surprising support for a rapid process from a shareholder group that sued the company over four years ago. This group, recently granted class-action status, holds the fourth-largest creditor claim in Nikola’s bankruptcy, estimated at $13 million due to a settlement agreement reached just before the bankruptcy filing. Joe Barsalona, representing the class-action plaintiffs, emphasized the urgency given Nikola’s shrinking cash reserves, describing the situation as akin to a “melting ice cube.”
