Shares of electric truck maker Nikola (NKLA) are plunging 15% after the company announced plans to raise $100 million in a secondary stock offering and possibly a private sale of stock to an unnamed investor if the offering raises less than $100 million.
The secondary offering, announced on Thursday, was priced at $1.12 a share, 20% below the stock's closing price of $1.40. Citigroup, which is underwriting the offering, also has the option to buy an additional $15 million worth of Nikola shares.
Nikola says it will use the funds for working capital and other general purchases. The company had just $233 million in cash available at the end of last year, after losing $222 million in the fourth quarter of last year.
Last year, Nikola built just over 250 electric trucks. The company says it hopes to build up to 350 new trucks this year.
Nikola shares are down 46% so far this year and have lost about 89% of their value over the past year.