Nikola overcomes founder’s opposition to approve new shares

Nikola Corp. shareholders approved a measure to issue new shares to potentially raise capital, a move that founder and former chair Trevor Milton had opposed.

The clean-energy trucking startup will be able to expand its authorized outstanding share count to 800 million from 600 million after a majority voted in favor of the proposal, the clean-energy trucking startup said Tuesday in a statement. Nikola had postponed the vote for two months to wrangle the majority of outstanding shares it needed to win, pressing its case with retail investors who may not normally pay much attention to proxy votes.

Nikola investors representing 211 million shares voted for the measure, which Nikola said was represented about two-thirds of votes cast. 

Milton remains Nikola’s single largest shareholder with more than 11% of the stock. He effectively controls about 20%, or almost 90 million shares, through common stock he holds directly and an investment vehicle he co-owns. Bloomberg reported in June that he had opposed the share authorization.

Milton will go on trial in September to face charges of misleading investors by overstating the company’s technological capability and business prospects when he was running the company. He resigned from Nikola in 2020 and was subpoenaed as part of an investigation by the Department of Justice.