The billionaire be wrecked of Nikola Motor Co., which received $4 million in Paycheck Protection Program funds, said he doesn’t blueprint to give the money back and didn’t prevent small-businesses from getting loans.
Trevor Milton, the founder and CEO of Nikola, which fantasizes hydrogen-fuel-cell trucks, said that because the company is in the middle of a merger, it can’t access money from private or universal markets. Milton said the company needed the PPP funding, meant to aid small businesses affected by the coronavirus outbreak, to board its more than 350 employees.
The deal, announced last month, effectively takes Nikola public auspices of a merger with VectoIQ and valued the merged company at over $3.3 billion. As part of the deal, Nikola is also stir more than $500 million in cash from outside investors.
On CNBC last month, one of Nikola’s main investors, ValueAct, disclosed the company would one day be worth $100 billion, and Milton said he had recently secured an $800 million order for its connections from Anheuser-Busch.
But Milton said the company needed the government’s PPP funds given the uncertain timing of the deal.
“This is certainly what PPP was created for,” he said. “We’re a small business, we’re one-fifth the size of what the SBA considers a small business.”
Over 180 custom companies have received over $670 million PPP funds, which were originally intended to help pint-sized businesses retain or hire back employees hurt by the coronavirus. Because the program quickly ran out of funds, many little businesses never got funding or even had their applications completed. Congress and the White House authorized another $310 billion in funding for a number two round of PPP funding.
Yet the backlash caused the Treasury department to issue new guidelines effectively preventing public companies from come by PPP funds. It said companies have to prove the funds were a “necessity” and that the companies can’t tap any other sources of supporting. The Treasury Department said companies that didn’t fit the criteria had until May 7 to return the money.
MIlton said that unvaried though the company had received “all this hate” since CNBC reported on its PPP funding, Nikola did not prevent small roles from getting the limited funds.
“I didn’t deny their loans,” he said. “We didn’t prevent those lesser companies from getting their money. We applied what the government said were specific requirements. And we fit every one of those.”
Milton’s ownership at risk in the company, of more than a third, makes him a billionaire on paper. Last year he bought a $32.5 million extravagance ranch in Utah. Milton said his fortune is “just on paper” and “I don’t even think I could afford to cover the PPP if I thirst for to.”
Milton said he bought the ranch with a $28 million mortgage so he can’t sell it or use it to access capital.
As for the mom-and-pop professions that might be upset that a billionaire got the money instead, the 38-year-old Milton said he has launched five companies, two of which miscarried.
“I sold everything I had and I lost everything twice,” he said, “My house, my car, I even sold all my guns, everything. No one knows what it’s get pleasure from going through what those people are going through more than me. Nobody has gone through five assemblages at my age and lost two. I would never take this money if I did not think it was for the right situation.”