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Lucid Motors agrees to go public with a valuation of $ 24 billion
(Bloomberg) – Lucid Motors Inc. to merge with blank check company led by financier Michael Klein, which values the combined entity at a pro-forma value of $ 24 billion, the largest in a series of deals involving electric vehicle startups The automaker has avoided comparisons with market leader Tesla Inc., but the public listing positions it to compete for a share of what is expected to become a rapidly growing market for electric vehicles. The deal, which confirms a previous Bloomberg News report, will generate about $ 4.4 billion in cash for the 14-year-old company, which plans to use the newly acquired funds to market vehicles and expand its plant in Arizona. latest beneficiary in a wave of investment targeting electric vehicle startups and next-gen automotive technology providers, sparked in part by a rally in Tesla shares over the past year as Wall Street seeks to match investors with formerly private companies. the largest injection of capital into Lucid since the Saudi Arabia Public Investment Fund invested more than $ 1 billion in 2018. The deal included a $ 2.5 billion private placement in public shares, or PIPE, the largest of its kind ever recorded for a deal with an acquisition company for purposes. It was led by existing investor PIF as well as BlackRock, Fidelity Management, Franklin Templeton, Neuberger Berman, Wellington Management and Winslow Capital, according to a joint statement from Lucid and Churchill Capital Corp IV, the acquisition company. share – a 50% premium over Churchill’s net asset value – which translates to about $ 24 billion in pro-forma value, the companies said. The combined company has a transaction value of $ 11.8 billion. Churchill shares fell 34% after the close at $ 57.37. “I see PSPC as just a tool, another lever to pull on, where we can accelerate our trajectory,” said Peter Rawlinson, CEO of Lucid, in an interview. “It’s a technology race. Tesla understands that. That’s why they’re so valuable and Lucid also owns the technology. ”PSPC is the largest company run by Klein, a former investment banker of Citigroup Inc. who has been instrumental in guiding Kingdom of Saudi Arabia investments, as an advisor to the PIF. He notably advised on the initial public offering of Saudi Aramco. The Lucid transaction is expected to close in the second quarter. Lucid will now begin production of its first EV , a luxury sedan called Air, in the second half of this year. The company had previously said deliveries of the $ 169,000 car would begin in the second quarter. But the company decided not to commit s ur a start date following negotiations with Churchill Capital, Rawlinson said. The company later plans to produce more affordable versions of the Air, as well as a battery-powered electric SUV. The Casa Grande plant currently has a production capacity of 34,000 units per year, based on three quarters installed. of work, said Rawlinson. Lucid hopes to increase this capacity to 85,000 units per year by 2023, after additional investments in the plant. Lucid expects deliveries of 20,000 vehicles in 2022 generating sales of $ 2.2 billion. According to a presentation made to investors on the company’s website, it expects revenues to rise to $ 5.5 billion and $ 9.9 billion in 2023 and 2024, respectively. The company expects positive earnings before interest, taxes, depreciation and amortization of $ 592 million in 2024. Beyond its manufacturing capacity, the company plans to invest heavily in new products and will increase its workforce to 5,000 over the next year, Rawlinson said . will be the closest car yet to challenge Tesla in the still niche market for premium EV sedans. The Air model has a range of 517 miles on a single charge, based on estimates from the Environmental Protection Agency. It can reach zero to 60 miles per hour in 2.5 seconds and has access to Electrify America’s network of DC fast chargers. This compares to the Model S Plaid +, which has a maximum range of around 520 miles, a zero to 60 launch in under 2 seconds, and access to Tesla’s nationwide network of fast chargers.Re of Musk’s market capitalization is just a fraction of Tesla’s nearly $ 690 billion valuation, but not bad for a luxury electric vehicle maker that has yet to build its first car. Rawlinson has repeatedly stated that Lucid is not a direct competitor to Tesla because his business is priced above the mass market buyers Elon Musk aspires to reach, but there are signs of an emerging rivalry. The Newark, Calif.-Based company – the headquarters of which just 16 miles from Tesla in Palo Alto – says its first EV will go the distance against the longer-range Model S sedan. Lucid’s new plant grew out of the Arizona desert just as quickly as Tesla’s last fast-build plant in China. And the growing interest in the startup and its CEO has drawn the wrath of none other than Musk. Rawlinson and Musk have a complicated history. Lucid CEO was chief engineer on Tesla’s flagship Model S, but Musk downplayed his role in its development and also accused him in a tweet of leaving the company “in embarrassment as things got tough. In 2012. is also working on energy storage solutions similar to Tesla’s Powerwall. The company wants to use the same battery technology in its cars to develop batteries to power homes and large-scale appliances and already has working prototypes, Rawlinson said (adds CEO comments from 7th paragraph; production targets of Lucid from the 11th paragraph). articles like this please visit us at bloomberg.com Subscribe now to stay ahead with the most trusted source of business news. © 2021 Bloomberg LP
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