Nikola stock has surged following news that the company could receive a cash infusion from an unexpected source. Founder and former CEO of Nikola, Trevor Milton, has been ordered by an arbitrator to pay $165 million to the company, according to a filing with the Securities and Exchange Commission.
Milton’s conviction for securities fraud in 2022, related to false statements made during the company’s development, led to this outcome. Nikola has referred to its SEC filing for further details, while Milton’s immediate availability for comment remains uncertain.
In Tuesday’s trading, Nikola stock closed with a notable 9% increase. This positive performance contributed approximately $80 million to the company’s market capitalization, roughly half of the awarded amount. The exact amount that Nikola will collect from the award is yet to be determined.
As of the end of the second quarter, Nikola had a cash balance of over $225 million. Analysts predict that the company will utilize approximately $100 million per quarter in the coming periods to support its business expansion.
Overall, these recent developments provide a much-needed boost for Nikola stock and offer potential for future growth.