The founder of Nikola (NASDAQ:NKLA) said late Wednesday that he is giving the first 50 employees hired by the electric truck manufacturer 6 million shares of the company's stock, fulfilling a promise he made to them when they were hired.
In a video posted online, Trevor Milton, now chairman of Nikola's board, noted the huge risk those first workers took on when they joined the start-up.
"The likelihood of us succeeding was like next to none, and luckily I found an incredible group of employees that started with me from day one to where we are today," Milton said.
I love our employees. They make Nikola great & are the key to our success. I'm making good on my promise when I hired the first +- 50 employees-giving 6,000,000 of my personal shares to them. You'll see a reduction in my holdings for this. They are not sold, but given.— Trevor Milton (@nikolatrevor) August 26, 2020
At Wednesday's close, the stock Milton will transfer to workers was worth about $233 million. He owns about 35% of the company's stock, worth a little more than $5 billion at current prices.
The public announcement seemingly serves two purposes. Nikola is one of a number of automotive companies battling to bring electric vehicles to market, and making good on this promise could help it attract talent. And Milton noted on Twitter that investors will see via regulatory disclosures that his stake will soon be reduced by 6 million shares, so he wanted to be clear he is not selling his stock.
The gift does have consequences for the recipients. The new owners will have the same lockup requirements Milton faced, and presumably will be taxed for the value of the shares they receive.
But those sorts of headaches seem a small price to pay for being granted millions of dollars' worth of stock, and are unlikely to be met with complaints from the recipients.