CNH Industrial recently announced updates on its $250 million investment in the Nikola Corporation made by its IVECO commercial vehicle segment following the completion of the merger between VectoIQ Acquisition Corp. and Nikola Corporation on June 3, 2020. Former shareholders of Nikola received 1.901 shares of VectoIQ for every one share held in Nikola. Nikola Corporation shares are now trading on Nasdaq under the new “NKLA” ticker symbol as of June 4th. IVECO now holds 25,661,449 shares of Nikola Corporation, or about 7.11% of Nikola outstanding share capital, because of the merger.
In accordance with US GAAP, CNH Industrial’s investment was accounted for using the cost method in absence of readily determinable fair value until the merger was finalised. The investment will now be valued at Fair Value Through Profit or Loss and changes in fair value will be recorded in Profit or Loss in the US GAAP consolidated financial statements. CNH plans to exclude any fair value adjustments of the investment from the calculation of Non-GAAP “Adjusted” measures the Adjusted diluted EPS. The company says the approach will be consistently applied at each reporting date.
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