Lucid
- Churchill Capital IV fell 35% in pre-market trading after Lucid Motors entered into an agreement to announce via the SPAC.
- The deal will raise $ 4.4 billion for Lucid, which plans to use the funds to expand its Arizona facility.
- Churchill’s deal values Lucid at about $ 24 billion at the PIPE offer price of $ 15.00 per share.
- Sign up here for our daily newsletter, 10 things before the opening clock.
Shares in Churchill Capital IV fell 35% early on Tuesday after the merger of the blankcheck company with Lucid Motors was announced.
The manufacturer of electric vehicles, Lucid, has confirmed that it will appear through the special acquisition company, which is run by financier Michael Klein, with a pro-forma share value of $ 24 billion.
The 14-year-old Lucid, who plans to use the funds to expand his manufacturing facility in Arizona, will generate about $ 4.4 billion in cash. The factory has a production capacity of 365,000 units per year on a scale.
Churchill’s market performance before the market is a reversal of previous sessions when reports of the transaction caused successive actions.
Speculation about the deal has been going on for more than a month. Earlier in February, shares in Churchill Capital IV rose 33% in a report that the SPAC was approaching an agreement. Shares rose 19% on Monday after Bloomberg said a deal could be announced Tuesday.
Lucid’s deal with Churchill, which is expected to close in the second quarter of this year, is one of the most sensational SPAC arrangements in the EV space following a huge interest in launching electric vehicles and technology providers for motor vehicles. This may have led to a rise in Tesla’s shares over the past twelve months. Peter Rawlinson, the CEO and CTO, is known for his work as chief engineer at Tesla for the Model S. He joined Lucid in 2013.
“I see the SPAC as just a tool, another lever to put on, where we can accelerate our trajectory,” Rawlinson said in an interview with Bloomberg. “It’s a technological race. Tesla gets it. That’s why they’s so valuable and Lucid has the technology, too.”
The merger of SPAC is the largest capital increase since Saudi Arabia’s sovereign wealth fund invested more than $ 1 billion in 2018. The transaction was led by the Public Investment Fund, as well as BlackRock, Fidelity Management & Research, Franklin Templeton, Neuberger Berman, Wellington Management, and Winslow Capital Management.
Shares of Churchill fell 35% in the pre-trade to $ 37.34 a share, after closing at $ 57.37 a share on Monday.