Lucid Motors reached an settlement to change into a publicly traded firm by a merger with special-purpose acquisition firm Churchill Capital IV Corp, within the largest deal but between a blank-check firm and electrical automobile startup.
The mixed firm, wherein Saudi Arabia’s sovereign fund will proceed to be the biggest shareholder, could have a transaction fairness worth of $11.75 billion. Private funding within the public fairness deal is priced at $15 a share, placing the implied the pro-forma fairness worth at $24 billion. The announcement comes greater than every week after Bloomberg, citing unnamed sources, reported a deal was near being finalized.
Lucid follows a string of different, albeit smaller valued, SPAC mergers with electrical automobile startups which have been introduced this yr, together with Arrival, Canoo, Fisker and Lordstown Motors. Several EV infrastructure firms together with EVgo and ChargePoint have additionally change into public firms by way of SPAC mergers.
Lucid might need been essentially the most anticipated. The hype and hypothesis that has been rampant for weeks drove up the inventory value of Churchill Capital IV Corp from its opening value of $10 a share greater than 470% since January 2021. The skyrocketing share value, plummeted greater than 30% after the main points of the deal had been introduced.
The personal funding and money from Churchill will present roughly $4.Four billion in complete funding to Lucid. That capital might be put to work to hurry up and increase Lucid’s plans. The firm plans to start manufacturing and deliveries of the Lucid Air in North America within the second half of this yr. The Air will come to Europe in 2022, adopted by China in 2023. The Gravity efficiency luxurious SUV is anticipated to return to market in North America in 2023. The automobiles might be produced at its new manufacturing unit in Casa Grande, Arizona.
The funding might be used to convey these two automobiles to market in addition to to increase its manufacturing unit in Arizona, Lucid CEO and CTO Peter Rawlinson mentioned Monday. The firm plans to increase the manufacturing unit over one other three phases within the coming years to have the capability to provide 365,000 items per yr at scale. The preliminary part of the $700 million manufacturing unit was accomplished late final yr and could have the capability to provide 30,000 automobiles a yr.
The deal may even assist Lucid understand its imaginative and prescient to provide electrical automobile applied sciences to 3rd events resembling different automotive producers in addition to supply power storage options within the residential, business and utility segments, Rawlinson mentioned.
Scaling an electrical automobile firm will not be low cost or simple. Lucid narrowly missed imploding a number of years in the past because it struggled to search out an investor that would supply the capital it wanted to convey its ultra-luxe electrical Air sedan into manufacturing. That investor ended up being Saudi Arabia’s sovereign wealth fund, which agreed in September 2018 to speculate $1 billion into Lucid Motors.
Lucid started in 2007 as Atieva, an organization based by former Tesla VP and board member Bernard Tse and entrepreneur Sam Weng that targeted on creating electrical automotive battery expertise. The early analysis, improvement and eventual progress within the parts and general electrical structure would lay the vital floor work for the longer term Lucid, which emerged on the finish of 2016 with new publicly acknowledged goal to make electrical automobiles (though the corporate had already been working quietly at this for a few years). Rawlinson, who left Tesla to affix Lucid in 2013 as CTO, was one of many driving forces behind this new mission. He later took on the CEO title and duty as nicely.
While Lucid is usually couched as a competitor to Tesla, Rawlinson has advised TechCrunch the Air is supposed to be a rival of the Mercedes S Class, the inner combustion engine flagship of the German automaker. The investor presentation launched Monday echoes Rawlinson’s earlier feedback, noting that “Tesla is revolutionary however not luxurious.” Lucid describes itself as “put up luxurious” and in competitors with “established luxurious” manufacturers Audi, BMW and Mercedes-Benz.
Lucid is taking a web page out of Tesla’s playbook and outlined plans to finally supply extra reasonably priced EVs as soon as it scales manufacturing.
Rawlinson will stay as CEO and CTO. The deal is anticipated to shut within the second quarter.