Beleaguered electric truck company Nikola has sold the assets of the Badger electric truck it was once supposed to build with General Motors. The buyer? A new company called Embr Motors has been created by car manufacturer and TV personality Dave “Heavy D” Sparks, one half of the former TV duo the Diesel Brothers.
Embr now owns the intellectual property related to the Badger truck, as well as the assets related to Nikola’s abandoned off-road vehicles and personal marine vehicles. He also owns the only two original versions of the Badger ever built.
The news of the deal to sell the Badger program comes at an odd time. Just a few weeks ago, disgraced Nikola founder Trevor Milton announced his plans to try to install Sparks and a slate of other managers to the company’s board of directors. This attempt failed. Milton was sentenced to four years in prison in December after being convicted of securities fraud and wire fraud in 2022, in part for misleading investors about Badger’s progress.
Since its establishment in 2014, Nikola has always been involved in the construction of large hydrogen-powered and electric rigs. But it unveiled the Badger pickup in February 2020, just months before it went public in a merger with a special-purpose buyout company. In September 2020, General Motors announced that it was investing $2 billion in the startup and would help bring the Badger to market. A few days later, the research firm Hindenburg Research published a damning report alleging that Nicola had made a number of false claims. That report led to a government investigation and ultimately led to Nicolas paying a settlement to the SEC and Milton’s resignation and eventual conviction. Nicola returned customer deposits for Badger and put the program on ice.
Sparks first revealed the purchase earlier this week in a YouTube video titled “The Nikola Badger is REAL and I own them”. He said the transaction involved “tens of millions” of dollars. He also explained how he was given stock in Nikola as part of a deal to promote Badger (before the program ended) and that he is a longtime friend of Milton.
Nikola confirmed some details of the purchase on Thursday morning when it revealed its financial results for 2023.
Britton Worthen, the company’s chief legal officer, said in a conference call that Sparks and his partner, Cole Cannon, “expressed a desire” to bring the Badger to market and brought “several EV-related partners” to meetings as the two sides were forging. in an agreement. Nikola is essentially lending money to Embr to buy the assets and in exchange for a 30% stake in the company, which could “retain some value for its shareholders” if something happens to Badger or the other vehicles.
Worthen said Nikola is getting back 500,000 of those shares that Milton gave Sparks as part of the deal. Sparks and Cannon also agreed that Milton would not be involved “directly or indirectly in any way” in these projects.
“In the three and a half years since Mr. Milton left the company, we at Nikola have worked to stay above the fray, not comment on his legal proceedings and stay focused on the job at hand to bring Class Eight Zero trucks shows in the market,” Worthen said on the call. “The irony that Mr Milton is now trying to take control of Nicolas, after everything that has happened in the last three and a half years is not lost on us at the company. We will continue to resist his attempts to take control of Nikola, and we believe that the directors and management are much better for our shareholders than a set of directors who do not have the relevant experience to run a clean energy clean technology company .”
TechCrunch reached out to Cannon for comment about his and Sparks’ involvement in the project, but did not immediately hear back.
