Troubled electric truck developer Nikola is at risk of being delisted from the Nasdaq, the company revealed in a regulatory filing on Thursday.
Nicola said it received a delisting notice from the public exchange on May 24 because its share price has been below $1 for the past 30 days. The company has until November 20 to comply with Nasdaq’s minimum price rule, which requires the share price to be above $1 for 10 consecutive business days.
Shares fell 20% to $0.62. Nikola’s shares were once as high as $65.90.
Nikola is one of a growing number of companies that went public through a merger with a special purpose acquisition company, only to see its market cap go into freefall, and in some cases, land in delisting limbo. Lordstown Motors said it also received a delisting notice this month. The notice and its failed deal with Foxconn prompted Lordstown to issue a reverse stock split. Many of these mobility companies were attracted to the capital that the public markets could access. And the use of SPACs as a financial instrument appears to have worked for the first time in 2021, becoming a buzzy meme stock.
Now the fundamentals are catching up with companies like Nikola, as well as other SPACs like Arrival, Bird and Canoo.