Early Lordstown Motors investor Workhorse Group sold most of stake in startup

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Electric delivery truck maker Workhorse Group Inc. said Monday it sold down much of its stake in Lordstown Motors Corp. this summer, reducing its equity position in the embattled Ohio-based startup.

Workhorse, in a company filing, said it had sold 11.9 million shares in Lordstown Motors since July 1, reducing its 9% stake by nearly three-quarters. Workhorse, also based in Ohio, was an early investor in Lordstown Motors, which was established in 2019 by Workhorse founder and former chief executive Steve Burns, an entrepreneur who had previously begun tech and marketing companies.

The divestiture comes ahead of Lordstown Motors' planned electric-truck launch in September. The startup is cash-strapped and trying to raise additional capital to ensure its survival.

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Starting production of Lordstown Motors' debut pickup truck, the Endurance, is a crucial target for the startup, which went public last fall through a reverse merger with a special-purpose acquisition company, or SPAC.

In recent months, the company has been rocked by numerous challenges, including federal investigations into its business practices, and the exit of Mr. Burns.

Workhorse said it netted $79 million from selling down its Lordstown Motors shares. Lordstown Motors stock was trading at $5.77 a share Monday morning, down 2.7% after Workhorse reported it reduced its stake.

The divestiture comes ahead of Lordstown Motors’ planned electric-truck launch in September. (Lordstown Motors/Lisa Acierno/Handout via REUTERS)

Lordstown Motors didn't immediately respond to a request for comment.

Workhorse, established in 2007, develops and sells electric-powered delivery trucks and vans for package-delivery companies and utilities. It went public in 2010 through an offering on the over-the-counter market.


Workhorse's ties to Lordstown Motors go beyond it holding an equity stake; several former Workhorse executives had followed Mr. Burns to Lordstown Motors after he started the electric-truck firm.

Lordstown Motors Executive Chairwoman Angela Strand, who is overseeing the company following Mr. Burns's departure in June, had served as a vice president at Workhorse until 2018. Others who joined Mr. Burns from Workhorse have since left, including Lordstown Motors' former chief financial officer and chief operating officer, and his daughter, Brittney Burns, who had been the company's marketing director.

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