Electric vehicle startup Canoo has revealed it is being investigated by the U.S. Securities and Exchange Commission (SEC).
Canoo went public earlier this year through a merger with special purpose acquisition company Hennessy Capital Acquisition Corp and during its quarterly earnings report posted on Monday, it said the SEC investigation covers Hennessy’s IPO and merger with Canoo, as well as the company’s operations, business model, revenues, revenue strategy, customer agreements, earnings, and other related topics.
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“The SEC has also informed the Company that the investigation does not mean that it has concluded that anyone has violated the law, and does not mean that it has a negative opinion of any person, entity or security. We intend to provide the requested information and cooperate fully with the SEC investigation,” Canoo said in the regulatory filing, Tech Crunch reports.
Canoo was founded as Evelozcity in 2017 by ex-Faraday Future executives Stefan Krause and Ulrich Kranz and in 2020, announced a partnership with Hyundai to co-develop electric vehicles. However, this partnership was dropped this year. A number of high-profile executives have also left the company in recent months, including Kranz, general counsel Andrew Wolstan, and chief financial officer Paul Balcuinas. It is understood the SEC investigation will look into the recent departures of these executives.
During its earnings release, Canoo said it ended the quarter with $614.9 million in cash and equivalents while reporting a net loss of $15.2 million compared to a loss of $30.9 million in the first quarter of 2020.
