Stock prices of American electric carmaker Nikola plunged by more than 7 percent on Tuesday after its founder Trevor Milton was accused by two women of sexual abuse. On the same day, General Motors confirmed that it was still engaging in talks with the company for a possible $2 billion partnership deal.
Two separate sexual abuse complaints against the 38-year-old founder were filed with Utah authorities on Tuesday. Both women claimed that they were 15-years old when the alleged sexual harassments happened. The accusations come just days after Milton had stepped down as Nikola's executive chairman.
Milton resigned from his position after short seller Hindenburg Research published a report accusing the electric startup of fraud. The report was published two days after GM announced that it was planning to establish a partnership with Nikola to supply electric technologies and build its planned electric pickup trucks. The report eventually led to the launch of separate investigations by the Department of Justice and the Securities and Exchange Commission.
Earlier in the month, GM's CEO Mary Barra defended the company's decision to partner with Nikola. The executive stated that GM had done "appropriate diligence" prior to engaging Nikola in negotiations. GM declined to comment on whether or not it was previously aware of any of the newly exposed sexual abuse and fraud allegations.
On Monday, GM stated that its deal with Nikola, which is supposed to close on Wednesday, has yet to be completed. A spokesperson for the carmaker stated that discussions over the deal are still ongoing and the companies will provide further updates as they come.
"Both sides are still negotiating. As soon as we have something to report, we will. But it is definitely still continuing," Nikola spokeswoman Colleen Robar mentioned on Tuesday.
Apart from the accusations, Nikola's stock prices have dropped by more than 60 percent since GM initially announced the deal. This makes a potential partnership much less attractive to GM. According to a public filing, the deal could be terminated if both sides don't reach an agreement by December 3.