Why Archer Aviation Stock Plummeted Today
Written by Johnny Rice for The Motley Fool -> A judge ruled that a shareholder lawsuit related to Archer's SPAC merger will proceed. Stellantis, a major backer of Archer, reported preliminary numbers showing a $2.68 billion loss for the first half of the year. Shares of Archer
A judge ruled that a shareholder lawsuit related to Archer's SPAC merger will proceed.
Stellantis, a major backer of Archer, reported preliminary numbers showing a $2.68 billion loss for the first half of the year.
Shares of Archer Aviation (NYSE: ACHR) fell on Monday, finishing the day down 10.9%. The drop came as the S&P 500 (SNPINDEX: ^GSPC) and Nasdaq Composite (NASDAQINDEX: ^IXIC) both gained modestly.
A judge ruled that a lawsuit against the company, which develops electric vertical takeoff and landing (eVTOL) aircraft , can move forward. At the same time, Stellantis , a major backer of Archer, reported poor preliminary numbers for its upcoming quarter.
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When Archer went public, it did so using a special purpose acquisition company (SPAC) . A lawsuit by shareholders of the company alleges that Archer, investor Ken Moelis, and other architects of the SPAC merger misrepresented the value of shares and misled shareholders as to how far along the company was in developing its aircraft.
The Delaware Chancery Court on Monday allowed the suit to continue, and Archer now must defend itself against the allegations.
A major backer of Archer, automotive giant Stellantis, released preliminary numbers ahead of its upcoming earnings report. The company expects a $2.68 billion loss for the first half of the year, and the company maintained its suspension of issuing any guidance, citing tariff uncertainty.
