Shares of Hanwha Solutions plunged Monday immediately after electric vehicle developer Nikola announced a leadership shakeup, as it faces a heap of fraud allegations and an upcoming probe.

Hanwha Solutions common shares retreated 7.4 percent Monday, while its preferred stocks dipped 10 percent.

Hanwha Solutions, a Seoul-based petrochemical arm of the Hanwha conglomerate, indirectly controls a minority stake in Nikola.

Nikola fetched a combined $100 million of funding evenly from Hanwha Energy and Hanwha General Chemical, both under the umbrella of Kospi-listed Hanwha Solutions. The two acquired the stake in 2018.

Before the revelation, Hanwha Solutions‘ investment in Nikola was seen as a move to set foot on US market with its investment in Nikola, which was listed on the US tech-heavy bourse Nasdaq in June.

Nikola announced Sunday that its founder Trevor Milton stepped down from its top post effective immediately. Milton will remain a stakeholder of Nikola.

Milton became the target of criticism following fraud allegations first raised by a short seller that the company had faked its technology to keep hydrogen-powered trucks in motion.

Electric vehicle battery maker stock LG Chem also fell 5.9 percent as investor doubts about its proposed split-off plan resurfaced, coupled with Nikola uncertainties.

By Son Ji-hyoung (consnow@heraldcorp.com)