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Hindenburg accused Nikola’s founder Trevor Milton of nepotism and said it has gathered enough evidence to show that Milton made false statements to form partnerships with large automakers.
The short-seller said Milton appointed his brother, Travis, to lead the Hydrogen Production/Infrastructure unit, despite not having any substantial experience related to the sector.
“Nikola has been vetted by some of the world’s most credible companies and investors”, the company said in a statement.
“(We) will not waver based on a report filled with misleading information attempting to manipulate our stock.”
Hindenburg alleged Milton misled partners into signing agreements by falsely claiming to have extensive proprietary technology.
Earlier this week, automaker General Motors Co (N:GM) took an 11% stake in Nikola and said the two companies will join forces to build electric pickup trucks and fuel cell commercial trucks to take on Tesla Inc (O:TSLA).
“Nikola seems to be bringing nothing to the partnership but concept designs, their brand name and up to $700 million they will be paying GM for costs related to production,” Hindenburg said on Thursday.
General Motors said it stands by the statements it made while announcing the partnership.
“We are fully confident in the value we will create by working together,” GM said in a statement.
Shares of Nikola, which have more than quadrupled in value this year, fell 7.7% to $39.09 in late morning trade. GM’s shares dropped nearly 3%.
