Electric vehicle maker Lightning eMotors has lost much of its value and faces mounting costs because of board members and officers’ misrepresentations before and after it went public in a merger with a blank-check company, investors allege.
Several insiders involved with the pre-merger SPAC had enormous financial incentives to complete the deal, shareholders Denish Bhavsar and Samhita Gera say on behalf of Lightning. The investors filed their derivative suit Wednesday in the US District Court for the District of Colorado, Bloomberg reports.
Two years ago this month, an investor filed suit against the GigCapital affiliates that engineered its reverse merger with Lightning eMotors, claiming they shortchanged public shareholders because the SPAC was structured to reward them for even a bad deal.
That lawsuit, filed in Delaware Chancery Court, targeted Gig principal Avi Katz and associates he allegedly appointed to the board of GigAcquisitions3, the sponsor behind the combination between Lightning and GigCapital3., one of several Katz-backed SPACs.
Lightning eMotors completed its deal with the SPAC in May 2021, receiving approximately $268 million in gross proceeds, including a $125 million PIPE.
Shares at the time of the company’s debut on the NYSE were trading at $172.80. Shares last traded this afternoon at $1.89. Read more.
