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

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

Lucid Motors reached an agreement to turn out to be a publicly traded firm via a merger with special-motive acquisition firm Churchill Capital IV Corp, in the splendid deal yet between a smooth-test firm and electric automotive startup. 

The blended firm, all over which Saudi Arabia’s sovereign fund will proceed to be the splendid shareholder, can beget a transaction fairness cost of $11.75 billion. Personal funding in the public fairness deal is priced at $15 a half, hanging the implied the official-forma fairness cost at $24 billion. The announcement comes bigger than per week after Bloomberg, citing unnamed sources, reported a deal used to be end to being finalized.

Lucid follows a string of different, albeit smaller valued, SPAC mergers with electric automotive startups which were announced this yr, including Arrival, Canoo, Fisker and Lordstown Motors. Several EV infrastructure companies including EVgo and ChargePoint beget also turn out to be public companies by capacity of SPAC mergers.

Lucid may well perhaps want been the most anticipated. The hype and speculation that has been rampant for weeks drove up the stock stamp of Churchill Capital IV Corp from its opening stamp of $10 a half bigger than 470% since January 2021. The skyrocketing half stamp, plummeted bigger than 30% after the particulars of the deal were announced.

The non-public funding and money from Churchill will present roughly $4.4 billion in entire funding to Lucid. That capital may well be put to work to bustle up and lengthen Lucid’s plans. The firm plans to commence up production and deliveries of the Lucid Air in North The USA in the second half of this yr. The Air will attain to Europe in 2022, adopted by China in 2023. The Gravity performance luxurious SUV is anticipated to achieve to market in North The USA in 2023. The autos may well be produced at its recent factory in Casa Grande, Arizona. 

The funding may well be passe to bring these two autos to market as successfully as to lengthen its factory in Arizona, Lucid CEO and CTO Peter Rawlinson acknowledged Monday. The firm plans to lengthen the factory over one more three phases in the approaching years to beget the ability to invent 365,000 objects per yr at scale. The initial phase of the $700 million factory used to be performed slack final yr and ought to beget the ability to invent 30,000 autos a yr.

Lucid Motors air EV

Image Credits: Lucid Motors

The deal can even support Lucid stamp its imaginative and prescient to invent electric automotive technologies to third events equivalent to different automotive producers as successfully as offer vitality storage solutions in the residential, industrial and utility segments, Rawlinson acknowledged.

Scaling an electrical automotive firm is no longer low-stamp or easy. Lucid narrowly missed imploding several years ago because it struggled to search out an investor that can perhaps perhaps offer the capital it critical to bring its extremely-luxe electric 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 started in 2007 as Atieva, a firm founded by primitive Tesla VP and board member Bernard Tse and entrepreneur Sam Weng that enraged by growing electric automotive battery abilities. The early analysis, pattern and eventual progress in the parts and general electric structure would lay the serious flooring work for the future Lucid, which emerged on the high of 2016 with recent publicly stated motive to originate electric autos (although the firm had already been working quietly at this for just a few years). Rawlinson, who left Tesla to affix Lucid in 2013 as CTO, used to be among the utilizing forces on the encourage of this recent mission. He later took on the CEO title and accountability as successfully.

While Lucid is in general couched as a competitor to Tesla, Rawlinson has suggested TechCrunch the Air is supposed to be a rival of the Mercedes S Class, the interior combustion engine flagship of the German automaker. The investor presentation launched Monday echoes Rawlinson’s earlier comments, noting that “Tesla is innovative but no longer luxurious.” Lucid describes itself as “post luxurious” and in competition with “established luxurious” producers Audi, BMW and Mercedes-Benz.

Lucid is taking a page out of Tesla’s playbook and outlined plans to one method or the other offer more cheap EVs as soon because it scales production.

Rawlinson will stay as CEO and CTO. The deal is anticipated to end in the second quarter.