Nikola’s stock tumbles after new supply deal with General Motors doesn’t include equity stake

Shares of Nikola Corp.
NKLA,
-7.63%
sank 15.2% in premarket trading Monday, after the battery- and hydrogen-electric vehicle maker said it signed an new supply agreement with General Motors Co.
GM,
-0.88%,
which doesn’t include the previously announced GM equity stake. Nikola said the new Memorandum of Understanding (MOU) “supercedes and replaces” the deal announced on Sept. 8. At that time, Nikola disclosed a subscription agreement in which it will issue and sell 47.7 million shares of its common stock to GM valued at $2.0 billion. Under terms of the MOU, Nikola and GM will integrate GM’s Hydrotec fuel-cell technology into Nikola’s zero-emission Class 7 and Class 8 semi-trucks, and the companies will “discuss” the potential for using GM’s Ultium battery system Nikola’s Class 7 and Class 8 trucks. Nikola said it continues to expect to begin testing prototypes of its fuel-cell powered trucks by the end of 2021. Nikola’s stock has dropped 32.5% over the past three months through Friday but was still up 170.6% year to date, while the S&P 500
SPX,
+0.24%
has advanced 12.6% this year.