The deal left the company with a market capitalization of $ 9.17 billion at the time of this writing, and will give more than $ 4 billion in cash to Lucid Motors. The transaction will be used to expand Lucid’s Arizona plant, said the company, which eventually hopes to be able to produce 365,000 vehicles a year.
Lucid is trying to compete directly with Tesla. Peter Rawlinson, Lucid’s CEO, helped develop the Model S sedan while working at Tesla from 2009 to 2012. Tesla, the world’s most valuable market cap maker, sells the Model S, a luxury electric sedan that starts in $ 73,990, with long-range variants also having a range of just over 500 miles.
CCIV is a special purpose acquisition company, or SPAC, which is a corporation whose sole purpose is to purchase or merge with a private company in order to make it public without a traditional initial public offering. Many companies chose to go public last year through SPACs instead of traditional IPOs, which usually attracts more scrutiny from investors and regulators.
Lucid’s merger was largely anticipated, raising the price of CCIV’s shares by more than 470% since the beginning of 2021. After the announcement of the deal, CCIV’s share price plummeted by more than 40%.
Lucid is the latest electric carmaker to go public through a SPAC merger.
EV start-ups arrival, Nikola and Fisker took advantage of investors’ seemingly endless appetite for SPACs.
SPACs raised $ 76 billion last year, a six-fold increase from 2019.
“A few years ago, SPACs were a relatively quiet corner of the market. This is no longer the case,” said David Gallers, co-founder and managing partner of Wealthspring, a company that invests in SPACs. “Billion-dollar unicorns are now embracing this.”
With reporting by Charles Riley
Correction: an earlier version of this story incorrectly identified the company’s market capitalization.