Lucid
- Churchill Capital Corp IV is reportedly in talks with Lucid Motors to announce the company.
- The SPAC has raised its share price by more than 300% since rumors of the merger first surfaced on January 11th.
- If the merger goes through, Lucid will be one of more than 130 companies announced via SPAC this year.
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Churchill Capital Corp IV rose 33% on Tuesday after a Reuters report suggested the company was close to an agreement to charge electric vehicle maker Lucid Motors at a valuation of about $ 12 billion.
The Michael Klein-backed SPAC is reportedly in talks with investors to raise between $ 1 and $ 1.5 billion for the transaction by selling shares in a PIPE. These funds are an extra boost to the $ 2 billion that Churchill Capital IV raised from its wallet in July.
According to Reuters, Lucid and Michael Klein have agreed on the most important terms of the agreement, which can be announced as early as this month.
Churchill Capital IV declined to comment on the deal, and Lucid Motors did not immediately respond to a request for comment. Both companies did not immediately respond to Insider’s request for comment.
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If implemented, the deal would be another successful merger of the SPAC for former Citigroup CEO Michael Klein, who on Monday raised another $ 1.6 billion for his sixth and seventh SPACs.
Rumors of a possible agreement between the Michael Klein SPAC Churchill Capital IV and Lucid began on January 11 when Bloomberg first reported that the two companies were in talks about a possible merger.
Subsequently, the shares of Churchill Capital rose by more than 300% as investors continued to target news in the red-hot EV market.
Lucid Motors was founded in 2007 as a battery company called Atieva by former Tesla CEO Bernard Tse and entrepreneur Sam Weng.
Since then, the company has transitioned to a full-fledged EV manufacturer focusing on luxury offerings. Lucid’s first EV, the Lucid Air, will aim for the Tesla Model S with its base price of $ 77,400, a distance of 517 miles and a quarter-mile time of 9.9 seconds.
Lucid also boasts a factory in Casa Grande, Arizona that, according to the company, will eventually produce 400,000 vehicles annually.
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Churchill’s move to merge with Lucid Motors follows a long line of new entrants to the public market over the past few years.
From Chinese manufacturer Nio to Lordstown Motors in Ohio, flash EV manufacturers, and SPACs are often their choice to enter public markets. More than 130 companies have now been launched in 2021 via a merger or buyout of the SPAC in what some call a SPAC boom.
While some of these SPAC entries paid off for investors, others were not as fruitful.
Lucid rivals Nikola and Fisker were both published by mergers with SPACs in 2020, and although Fisker made strong profits, many of Nikola’s profits were wiped out as EV entrants faced increasing competition.
Shares of CCIV, however, responded positively to the news and traded up 32.44% on Tuesday at $ 52.95.