Lucid Motors has confirmed that it is going public through a merger with Churchill Capital IV (CCIV). The deal, which is expected to close in the second quarter, is said to be the largest to date between a SPAC and an EV startup.
The transaction values Lucid at an initial pro-forma equity value of about $24 billion, and a transaction equity value of $11.75 billion. It is expected to leave Lucid with approximately $4.4 billion in cash. Saudi Arabia’s sovereign investment fund will continue to be the largest shareholder.
Of the current wave of EV startups, Lucid has been perhaps the most closely-watched, thanks to its high-profile CEO (Peter Rawlinson was the Chief Engineer for Tesla’s Model S) and stable of deep-pocketed backers, which also includes Wall Street dealmaker Michael Klein and funds managed by BlackRock. Reuters called Lucid “one of the strongest of the flock of startups challenging Tesla’s dominance.”
Speculation over the deal been circulating for more than a month, driving up Churchill Capital’s share price to lofty heights. Once the deal was announced, the “buy the rumor, sell the fact” phenomenon kicked in, and CCIV dropped over 30%.
Lucid plans to begin production and deliveries of the Lucid Air in North America in the second half of this year. The Air is slated to arrive in Europe in 2022, followed by China in 2023. The Gravity, a performance luxury SUV, is planned for 2023. The company will use the new funding to bring those two vehicles to market, and to expand its Arizona factory. The initial phase of the $700-million pant has a capacity of 30,000 vehicles per year, and Lucid plans to expand it in another three phases in the coming years to an eventual capacity of 365,000 units.
Lucid also aspires to supply EV technologies to other OEMs, and to offer stationary storage solutions in the residential, commercial and utility markets.