Written by Cláudio Afonso | LinkedIn | X
A few hours after reporting its third-quarter financial results, EV maker Nikola announced an amendment to its equity distribution agreement with Citigroup Global Markets Inc., enabling the raise of an additional $237.6 million through the sale of common stock.
The move follows previous agreements dating back to August 2022, with further amendments made in August 2023 and earlier this year, in May.
Earlier this Thursday, during the conference call, Nikola‘s CFO Tom Okray said the company has a cash runway of “five to six months,” considering a monthly burn rate of $30 million to $40 million.
Okray added that the company is “working right now to try to raise the necessary capital to give us the runway to go much further into 2025.”
The amended equity distribution agreement, originally aimed at a total $600 million offering, has already seen Nikola sell over 9.1 million shares for approximately $362.4 million in gross proceeds. Currently, $237.6 million remains available for issuance.
As the sales agent, Citigroup will receive a fixed commission of 2.5% on gross proceeds from shares sold under this arrangement, according to the filing.
Nikola shares fell 7% on Thursday and closed at $3.93.
Okray noted that the company had “some one-time and some annual payments” in the third quarter causing an increased cash burn rate.
Nikola has recently informed employees of a new round of layoffs, coming less than 18 months after the company cut 23% of its Arizona workforce. The latest round impacted 135 employees, roughly 15% of the company’s staff.
The company announced that its net third quarter revenue was negatively impacted by $7.7 million as it repurchased 20 BEV trucks from one of its dealers.
In the earnings call, the company’s CFO said Nikola has “a PO in hand to deliver these units to another dealer.”
“We have a customer for them [the 20 returned trucks] in Q4,” Okray added later in the call.
Written by Cláudio Afonso | LinkedIn | X
