The Lucid Air sedan, expected to go into production next year at a factory in Arizona.
Bright
Lucid Motors, an electric vehicle company, plans to go public at a combined equity valuation of $ 11.75 billion and $ 24 billion pro-forma equity via reverse merger with a blank check company formed by the experienced investment banker Michael Klein.
The deal between Newark, California-based Lucid and Churchill Capital Corp IV is the largest in a series of such links involving EV companies and blank check companies, also known as specialty acquisition companies or SPACs.
Previous SPAC deals with EV startups such as Nikola, Fisker, and Lordstown Motors yielded pro forma valuations of less than $ 4 billion, but Lucid is further afield than those companies. Lucid will deliver its first car this spring, a luxury sedan called the Air.
The deal will generate approximately $ 4.4 billion in cash for expansion plans for Lucid, including the current Arizona plant.
Shares of CCIV fell about 30% to $ 40 on long-term trading.
Lucid is led by ex-Tesla engineering executive and automotive veteran Peter Rawlinson, who joined the company in 2013 as chief technology officer before adding CEO to his responsibilities in April 2019. He will continue to hold those positions after the deal’s expected close in the second quarter, the companies said.
Lucid was founded in 2007 as Atieva, a name it now uses for its engineering and engineering arm that supplies batteries to the Formula E electric race track. The company first focused on electric battery technology before changing its name and transitioning to a manufacturer in 2016 of electric vehicles. three years after Rawlinson joined the company to lead technology development.
Lucid had some difficulty in securing capital to fund its plans until September 2018, when it received $ 1 billion from Saudi Arabia’s sovereign wealth fund.
Rawlinson last year described SPAC deals as quick money, but not enough capital to put a vehicle into production internally, which has led companies like Fisker to look for contract manufacturers.
Ahead of the announcement with Klein’s company, Rawlinson said the company had the funding to begin manufacturing the Air at a factory in Casa Grande, Arizona, southeast of Phoenix.
The new funding is expected to assist Lucid in its expansion plans. Rawlinson expects the Air to be the catalyst for a range of future all-electric vehicles, including an SUV going into production in early 2023 and more affordable vehicles later.
Lucid currently employs nearly 2,000 people, with 3,000 employees expected to be added in the US by the end of 2022, the company said.
The deal involves a total investment of approximately $ 4.6 billion. It is funded by $ 2.1 billion in cash from CCIV and a $ 2.5 billion fully committed PIPE at $ 15 per share by Saudi Arabia’s sovereign wealth fund and by funds and accounts managed by BlackRock, Fidelity and others.