CCIV stock tanks 27% after Lucid Motors confirms SPAC deal

CCIV stock

CCIV stock tanks 27% after Lucid Motors confirms SPAC deal

Lucid Motors and Churchill Capital IV (CCIV) have finally confirmed a merger deal to take the California based EV company public. Shares of Churchill Capital …
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Lucid Motors and blank check company Churchill Capital IV () confirmed a merger deal to take the California-based EV company public. Shares of Churchill Capital are down around 30% in pre-market.

The transaction values Lucid at an initial pro-forma equity value of approximately $24 billion at the PIPE (private investment in public equity) offer price of $15.00 per share and will provide Lucid, with approximately $4.4 billion in cash (assuming no existing CCIV shares are redeemed for cash at closing).

The deal has a transaction equity value of $11.75 billion which includes a cash contribution from CCIV of $2.1 billion, a PIPE investment of $2.5 billion with a lock-up provision for holders. 

Speculation over a deal has been circulating for more than a month. In mid-February shares of Churchill Capital IV, led by investment banker Michael Klein, of a nearing agreement. On Monday the stock gained double digit percentages after an agreement could come as soon as Tuesday.

The electric vehicle maker is backed by Saudi Arabia’s sovereign wealth fund. A deal with Churchill Capital IV is one of highest profile EV SPAC agreements since Nikola () and Fisker () debuted publicly last year.

Lucid Motors has been closely watched since it is competing in the electric luxury sedan space. The company's CEO and CTO Peter Rawlinson was the chief engineer at Tesla () for the model S prior to joining Lucid Motors in 2013.

Lucid Motors placed its first US production factory in Casa Grande, Arizona. The company aims to meet production goals for of its most expensive vehicle, the Air Dream Edition this year.

“I think it's really important that we start at a high-end position as a true luxury brand. I'm a great believer that the first product defines the brand in way Tesla model S defined Tesla as a brand,” Rawlinson

In an email to Yahoo Finance on Monday prior to a deal announcement, Lucid's official statement read “Lucid Motors has always been clear about its intent to go public at some point in order to accelerate the adoption and global availability of Lucid’s exclusive electric vehicle and sustainability technologies…Currently, our focus continues to be on bringing Lucid Air to production in Spring of this year, with the strong support of key investors and our partners at the Public Investment Fund.”

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Lucid also confirmed it , just blocks away from Tesla's showroom.

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Churchill Capital Corp IV57.37+4.43+8.37%Churchill Capital Corp IV64.31+5.44+9.24%China Coal Energy Company Limited7.57+1.32+21.12%Fisker Inc.18.12+0.13+0.72%MBH Corporation PLC0.4830+0.0170+3.65%TRENDING 1. 2. 3. 4. 5.
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Lucid, run by an ex-Tesla engineer, is the latest firm to tap the initial public offering market, with investors rushing into the EV sector, spurred by the rise of Tesla Inc and with emissions regulations toughening in Europe and elsewhere. The deal, which has a transaction equity value of $11.75 billion, includes a $2.1 billion cash contribution from CCIV and a PIPE (private investment in public equity) investment of 2.5 billion from investors. Reuters was first to report last week that Michael Klein had launched a financing effort to back the Lucid deal.

13h agoAxios

The electric vehicle startup Lucid Motors is going public via merger with the special purpose acquisition company Churchill Capital Corp IV at a valuation of $24 billion, the companies said Monday.Why it matters: The high value of the transaction with the blank-check firm headed by former Citi exec Michael Klein underscores how Lucid could be well positioned in the growing market.Get market news worthy of your time with Axios Markets. Subscribe for free.The Silicon Valley-based company, whose CEO Peter Rawlinson is a Tesla alum, is beginning deliveries this year of its Lucid Air sedan.The company says the luxury vehicle will have over 500 miles of range, the highest in the industry. It's also backed by Saudi Arabia's huge sovereign wealth fund.Were it stands: Investors in the deal in include the Saudi fund as well as funds and accounts managed by BlackRock, Fidelity Management & Research LLC, Franklin Templeton, and others, the announcement states.Via Bloomberg, it's the “largest injection of capital into Lucid since Saudi Arabia’s Public Investment Fund invested more than $1 billion in 2018.”CCIV stock was trading after the announcement at $42 per share, implying a valuation for Lucid of $67 billionWhat's next: The announcement said the deal will provide Lucid with $4.4 billion in proceeds that will be used to expand Lucid's manufacturing plant in Arizona, which Lucid plans to scale up in phases.Beyond the phased-in growth of Lucid Air production, the company plans to bring an SUV into production in 2023.”Scheduled to expand over three phases in the coming years, our Arizona facility is designed to be capable of producing approximately 365,000 units per year at scale,” the announcement states.The proceeds will also help Lucid implement plans to become a tech supplier for other auto manufacturers, and enter the stationary battery storage market.More from Axios: Sign up to get the latest market trends with Axios Markets. Subscribe for free

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1d agoBloomberg

(Bloomberg) — Shares of the blank-check firm combining with electric-vehicle startup Lucid Motors Inc. plunged in early trading after confirming the biggest SPAC merger yet to cash in on investor enthusiasm for battery-powered cars.Churchill Capital Corp IV, the special-purpose acquisition company run by financier Michael Klein, fell as much as 42% in premarket trading after confirming its merger with Lucid. The deal will generate about $4.4 billion in cash for the 14-year-old carmaker, which announced production of its debut model will be delayed to the second half of this year.Lucid has shied away from comparisons to market leader Tesla Inc., but the public listing at a pro-forma equity value of $24 billion positions it to compete for a slice of what’s expected to become a rapidly growing market for EVs. 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Rawlinson has stated repeatedly that Lucid is not a direct competitor to Tesla because his company’s price point is beyond the mass-market buyers Elon Musk aspires to reach.But there are signs of a budding rivalry.The Newark, California-based company — the headquarters of which are just 16 miles from Tesla’s in Palo Alto — says its first EV will go the distance against the longest-range Model S sedan. Lucid’s new factory arose out of the Arizona desert as fast as Tesla’s in China. And growing interest in the startup and its CEO has drawn the ire of none other than Musk.Rawlinson and Musk have a complicated history. The Lucid CEO was chief engineer on Tesla’s flagship Model S, but Musk has downplayed his role in its development and also accused him in a tweet of leaving the company “in the lurch just as things got tough” in 2012.Longer-term, Lucid 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 utility-scale devices and already has working prototypes, Rawlinson said.(Updates with share move in the second paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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