Lucid Motors strikes SPAC deal to switch public with $24 billion valuation

Home   /   Lucid Motors strikes SPAC deal to switch public with $24 billion valuation
Lucid Motors strikes SPAC deal to switch public with $24 billion valuation

Lucid Motors reached an settlement to change into a publicly traded firm by a merger with special-reason acquisition firm Churchill Capital IV Corp, in the largest deal but between a blank-take a look at firm and electrical automobile startup. 

The mixed firm, whereby Saudi Arabia’s sovereign fund will continue to be the largest shareholder, will have a transaction equity price of $11.75 billion. Non-public funding in the general public equity deal is priced at $15 a fraction, placing the implied the pro-forma equity price at $24 billion. The announcement comes extra than per week after Bloomberg, citing unnamed sources, reported a deal became discontinuance to being finalized.

Lucid follows a string of diversified, albeit smaller valued, SPAC mergers with electrical automobile startups that were launched this year, including Arrival, Canoo, Fisker and Lordstown Motors. Several EV infrastructure corporations including EVgo and ChargePoint have also change into public corporations by strategy of SPAC mergers.

Lucid can were doubtlessly the most anticipated. The hype and hypothesis that has been rampant for weeks drove up the stock label of Churchill Capital IV Corp from its opening label of $10 a fraction extra than 470% since January 2021. The skyrocketing fragment label, plummeted extra than 30% after the crucial facets of the deal were launched.

The internal most funding and cash from Churchill will provide roughly $4.4 billion in complete funding to Lucid. That capital will be put to work to breeze up and amplify Lucid’s plans. The firm plans to initiate production and deliveries of the Lucid Air in North America in the 2nd half of this year. The Air will attain to Europe in 2022, adopted by China in 2023. The Gravity performance luxurious SUV is anticipated to attain wait on to market in North America in 2023. The vehicles will be produced at its original factory in Casa Grande, Arizona. 

The funding will be dilapidated to say those two vehicles to market besides to to amplify its factory in Arizona, Lucid CEO and CTO Peter Rawlinson said Monday. The firm plans to amplify the factory over one other three phases in the impending years to be succesful to originate 365,000 units per year at scale. The initial segment of the $700 million factory became carried out expressionless final year and will be succesful to originate 30,000 vehicles a year.

The deal might presumably also encourage Lucid discover its imaginative and prescient to originate electrical automobile applied sciences to 3rd parties corresponding to diversified automobile producers besides to offer energy storage solutions in the residential, commercial and utility segments, Rawlinson said.

Scaling an electrical automobile firm just just isn’t any longer cheap or easy. Lucid narrowly missed imploding several years in the past as it struggled to get an investor that will presumably well offer the capital it desired to say its ultra-luxe electrical Air sedan into production. That investor ended up being Saudi Arabia’s sovereign wealth fund, which agreed in September 2018 to make investments $1 billion into Lucid Motors.

Lucid began in 2007 as Atieva, a firm basically based by dilapidated Tesla VP and board member Bernard Tse and entrepreneur Sam Weng that targeted on increasing electrical automobile battery know-how. The early analysis, pattern and eventual development in the substances and total electrical architecture would lay the crucial ground work for the prolonged whisk Lucid, which emerged at the end of 2016 with original publicly said reason to beget electrical vehicles (even supposing the firm had already been working quietly at this for a few years). Rawlinson, who left Tesla to join Lucid in 2013 as CTO, became one in all the utilizing forces in the wait on of this original mission. He later took on the CEO title and accountability as smartly.

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While Lucid is on the total couched as a competitor to Tesla, Rawlinson has told TechCrunch the Air is supposed to be a rival of the Mercedes S Class, the internal combustion engine flagship of the German automaker. The investor presentation launched Monday echoes Rawlinson’s earlier feedback, noting that “Tesla is modern however no longer luxurious.” Lucid describes itself as “put up luxurious” and in opponents with “established luxurious” producers Audi, BMW and Mercedes-Benz.

Lucid is taking a net page out of Tesla’s playbook and outlined plans to at final offer extra much less dear EVs as soon as it scales production.

Rawlinson will remain as CEO and CTO. The deal is anticipated to discontinuance in the 2nd quarter.

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