Trevor Milton, Founder of Nikola, Aims to Acquire Assets of Bankrupt Startup
Trevor Milton, the founder of Nikola Corporation, has recently made headlines again as he attempts to acquire the assets of his former company amidst its Chapter 11 bankruptcy proceedings. This significant turn of events comes after Milton was pardoned for his previous conviction related to securities fraud. The latest court filings and insider information reveal the complexities surrounding Milton’s bid and Nikola’s ongoing financial struggles.
Nikola’s Chapter 11 Bankruptcy Filing
Nikola Corporation filed for Chapter 11 bankruptcy protection in February, aiming to restructure its operations and sell its business by mid-April. The company has faced numerous challenges, including:
- Battery fires
- Product recalls
- Financial instability
Milton’s attempt to reclaim a foothold in the company he founded in 2014 has not been welcomed warmly.
Milton’s Bid and Its Challenges
According to reports, Milton’s interest in acquiring Nikola’s assets has met with significant resistance. Recently, Nikola prohibited him from personally inspecting the assets at its Coolidge, Arizona, factory. This decision was highlighted in a report by the Phoenix Business Journal.
Background on Trevor Milton
Milton’s history with Nikola is marked by a series of notable events, including:
- Founding Nikola in 2014
- Taking the company public in 2020 through a special purpose acquisition company (SPAC)
- Stepping down following fraud allegations
- Conviction in 2022 and sentencing to four years in prison in 2023
- Receiving a pardon from President Trump in February 2023
Legal Proceedings and Other Bids
In the latest filings, a Nevada entity known as ISSO LLC submitted a bid for Nikola’s assets on March 21. The bidding process allowed ISSO to inspect the factory; however, they faced restrictions, including:
- No video or photographs allowed
- Exclusion of a specific ISSO representative from the facility
Insider reports suggest that this representative may be Milton himself, as his father and lawyer are associated with ISSO’s filings.
Court Reactions
During a recent hearing, Nikola’s legal counsel characterized Milton’s interest in the company as “nothing more than a publicity stunt.” Judge Thomas Horan upheld the company’s decision to restrict Milton’s access to the factory, citing justifications for this necessity. The court plans to hold an auction on April 7 at 10:00 a.m. ET to evaluate bids and determine the best offer for Nikola’s assets.
Conclusion
As Nikola Corporation navigates its bankruptcy proceedings, the outcome of the upcoming auction and Milton’s bid remains uncertain. Stakeholders are eagerly awaiting updates, which will undoubtedly shape the future of the company.
For more insights on corporate restructuring and bankruptcy, visit our bankruptcy resources page.
