Electric vehicle company Lucid Motors goes public in $ 11.8 billion blank check merger

Electric vehicle company Lucid Motors plans to go public with a combined share valuation of $ 11.75 billion and pro forma equity value of $ 24 billion through reverse merger with company blank check launched by seasoned investment banker Michael Klein.

The deal between Newark, Calif., Lucid and Churchill Capital Corp IV is the most significant in a series of mergers involving EV companies and blank check companies, also known as special purpose acquisition, or SPAC.

Previous SPAC contracts with EV start-ups such as Nikola, Fisker, and Lordstown Motors generated pro forma valuations of less than $ 4 billion, but Lucid is more advanced than these companies. Lucid is set to deliver its first vehicle – a luxury sedan called Air – this spring.

The deal will generate approximately $ 4.4 billion in cash for Lucid’s expansion plans, including its current plant in Arizona.

Shares of CCIV fell about 30% to $ 40 in extended trading.

Lucid is led by ex-Tesla Engineering Director and automotive veteran Peter Rawlinson, who joined the company as CTO in 2013 before adding CEO to his responsibilities in April 2019 He will continue to hold that post after the deal is scheduled to close in the second quarter, according to the companies.

Lucid was founded in 2007 under the name Atieva, a name it now uses for its engineering and technology branch that supplies batteries to the Formula E electric racing circuit. focused on electric battery technology before changing its name to an electric vehicle manufacturer in 2016, three years after Rawlinson joined the company to lead its technology development.

Lucid had some difficulty securing capital to finance his projects until September 2018, when he received $ 1 billion from Saudi Arabia’s sovereign wealth fund.

Last year, Rawlinson described the PSPC deals as quick money, but not enough capital to get a vehicle to produce in-house, which has led companies like Fisker to seek contract manufacturers.

Prior to the announcement with Klein’s company, Rawlinson said the company had the funding to begin producing air at a plant in Casa Grande, Ariz., Located southeast of Phoenix.

The new funding is expected to help Lucid with its expansion plans. Rawlinson expects the Air to be the catalyst for a range of future all-electric vehicles, including an SUV starting production in early 2023 and more affordable vehicles down the line.

Lucid currently employs nearly 2,000 people, with 3,000 expected to be added to the United States by the end of 2022, according to the company.

The deal includes a total investment of approximately $ 4.6 billion. It is funded by $ 2.1 billion in cash from CCIV and a fully committed PIPE of $ 2.5 billion at $ 15 per share by Saudi Arabia’s sovereign wealth fund, as well as funds and accounts managed by BlackRock, Fidelity and others.