(Reuters) – Electric truck maker Nicola is approaching filing for bankruptcy, the Wall Street Journal reported Thursday, citing people familiar with the issue.
The company’s shares fell 20% to 60 cents in expansion transactions.
According to the report, Nicola, based in Phoenix, Arizona, was working with law firm Pillsbury Winsbury Shaw Pittman to explore options such as selling and restructuring of bankrupt companies.
The company is struggling to raise funds and its cash balances are declining as it continues to lose hundreds of thousands of dollars in every unit sold.
Nicola said Thursday that she is evaluating a variety of options, including fundraising as part of a fiscal restructuring.
However, the company declined to comment on whether it was investigating bankruptcy proceedings.
Pillsbury Winthrop Shaw Pittman did not immediately respond to Reuters’ request for comment.
Bloomberg News reported last month that electric truck makers were exploring options, including selling part of their business and the entire company.
Nikola’s cash and cash equivalents fell sharply at the end of September, compared to $464.7 million at the end of 2023.
The stock has lost more than 99% of its value since its publication in 2020.
The stock has been below the one mark several times, and the company has resorted to multiple reverse stock splits to comply with NASDAQ listing rules.
(Reporting by Akash Sriram of Bengaluru, edited by Shilpi Majumdar and Shounak Dasgupta)
