Nikola Corporation (NASDAQ:NKLA) is planning to raise capital by the way of a $100 million stock sale to investors, according to a filing with the United States Securities and Exchange Commission.

What Happened: The automaker said in the filing, first noticed on the Financial Times, it intends to use the net proceeds from the offering for “general corporate purposes” and for funding the completion of its manufacturing facility in Arizona.

Wedbush analyst Daniel Ives said that multiple electric vehicle players were trying to raise capital in what is an estimated $5 trillion EV market over the next decade, FT noted.

“Right now, it’s an arms race, and Nikola is trying to execute on their vision,” Ives said. Nikola is trying to rebuild its credibility “brick by brick,” as per the analyst.

The company’s market capitalization has fallen from $37 billion in June to $6.69 billion, as of Monday. 

In February, Ives changed his rating on Nikola to Neutral from Underperform and raised the price target to $25 from the earlier $15 saying most “negative catalysts” have played out. 

The Phoneix, Arizona-based company expects to provide prototype fuel cell Tre model trucks to Anheuser-Busch Inbev SA (NYSE:BUD) for testing in 2022. 

For its battery electric vehicles, deliveries are expected to begin in 2022, as per FT.

Price Action: Nikola shares fell 3.75% in after-hours trading to $16.42 on Monday after closing 0.24% higher at $17.06 in the regular session.

Photo courtesy: Nikola Motor Corp.

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