Hydrogen-powered truckmaker, Nikola, has returned fire on a scathing report that laid bare accusations the company was an intricate fraud.
The claims were made by hedge fund Hindenburg Research following the announcement General Motors was taking an 11 per cent stake in Nikola worth $US2 billion as part of a partnership to build the futuristic Nikola Badger pick-up truck.
CFA Nate Anderson, who wrote the report, 'Nikola: How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America', accused the company of claiming proprietory technology and vehicle components purchased from other manufacturers and accused Founder and CEO Trevor Milton of making countless false statements over the last decade including evidence that Nikola's breakthrough battery system did not exist.
In response Milton called Hindenburg an activist short-seller who was manipulating the market and dismissed the claims found in the report as misleading and salacious.
“To be clear, this was not a research report and it is not accurate," Milton said in a statement on Twitter.
"This was a hit job for short sale profit driven by greed.”
To evaluate potential legal recourse, Nikola has hired Kirkland & Ellis LLP, a law firm that specialises in vehicle manufacturing.
The report released right before markets opened helped drive an 11 per cent drop in Nikola shares.
Stock prices for the startup fell as much 13 percent late last week after Citron Research, another short-seller firm, tweeted its support for the Hindenburg report.