Lucid Motors has reached an agreement to become a publicly traded company through a merger with Special Purpose Acquisition Company Churchill Capital IV Corp, in the largest agreement to date between a blank check company and electric vehicle startup.
The merged company, in which Saudi Arabia’s sovereign wealth fund will remain the largest shareholder, will have a transaction value of $ 11.75 billion. Private investment in the private equity transaction is valued at $ 15 a share, bringing the implicit value of pro forma equity to $ 24 billion. The announcement comes more than a week after Bloomberg, citing anonymous sources, announced that a deal was about to be finalized.
Lucid follows a series of other, albeit less valuable, SPAC mergers with EV startups that were announced this year including Arrival, Canoo, Fisker and Lordstown Motors. Several EV infrastructure companies, including EVgo and ChargePoint, have also become state-owned enterprises through SPAC mergers.
Lucid could have been the most anticipated. The hype and speculation that has raged for weeks has pushed Churchill Capital IV Corp’s share price higher from its opening price of $ 10 per share by more than 470% since January 2021. The surge of the share price, fell more than 30% after details of the deal were announced.
Churchill’s private investment and liquidity will provide approximately $ 4.4 billion in total funding to Lucid. This capital will be used to accelerate and expand Lucid’s plans. The company plans to begin production and deliveries of the Lucid Air in North America in the second half of this year. Air will arrive in Europe in 2022, followed by China in 2023. The The gravity-driven performance luxury SUV is expected to be released in North America in 2023. The vehicles will be produced at its new plant in Casa Grande, Arizona.
The funding will be used to bring these two vehicles to market as well as to expand its plant by ArizonaLucid CEO and CTO Peter Rawlinson said Monday. The company plans to expand the plant in three more phases in the coming years to have the capacity to produce 365,000 units per year on a large scale. The initial phase of the $ 700 million plant was completed late last year and will have the capacity to produce 30,000 vehicles per year.
The deal will also help Lucid realize its vision of providing electric vehicle technologies to third parties such as other automakers, as well as providing energy storage solutions in the residential, commercial and utility segments. , said Rawlinson.
Growing an electric vehicle business is neither easy nor cheap. Lucid narrowly missed imploding several years ago as he struggled to find an investor who would provide him with the capital he needed to put his ultra-luxurious Air electric sedan into production. This investor ended up being the sovereign wealth fund of Saudi Arabia, which agreed in September 2018 to invest $ 1 billion in Lucid Motors.
Lucid started in 2007 as Atieva, a company founded by former Tesla vice president and board member Bernard Tse and entrepreneur Sam Weng that focused on developing battery technology. of electric cars. Early research, development, and eventual advancements in components and the overall electrical architecture would lay the groundwork for the future Lucid, which emerged in late 2016 with a new publicly stated goal of making electric vehicles (although the company has already worked quietly on this for a few years). One of the driving forces behind this new mission was Rawlinson, who left Tesla to join Lucid in 2013 as CTO. Later, he also assumed the title and responsibility of CEO.
While Lucid is often touted as a competitor to Tesla, Rawlinson told TechCrunch the Air was supposed to be a rival to the Mercedes S-Class, the German automaker’s flagship internal combustion engine. The investor presentation released on Monday echoes previous comments from Rawlinson, noting that “Tesla is innovative but not luxury.” Lucid describes himself as “post-luxury” and competes with the “established luxury” brands Audi, BMW and Mercedes-Benz.
Lucid takes a page from Tesla’s playbook and laid out plans for possibly offering more affordable EVs once production is scaled up.
Rawlinson will remain CEO and CTO. The deal is expected to close in the second quarter.