Churchill Capital Corp. IV rises 19%, as report informs investors that they should expect business from Lucid Motors as early as Tuesday

Churchill Capital IV’s shares soared by 19% on Monday after a Bloomberg report said a merger with electric vehicle maker Lucid Motors could take place on Tuesday.

There were rumors about a merger of Churchill Capital IV, a special purpose acquisition company, and Lucid for more than a month.

A transaction could use $ 2 billion in cash raised by Churchill Capital IV’s initial public offering and $ 1 billion to $ 1.5 billion from institutional investors to support the transaction.

The combined entity can be valued at about $ 15 billion, sources told Bloomberg.

Churchill Capital IV’s stock has soared more than 425% since the first reports of negotiations between SPAC and Lucid Motors, backed by Michael Klein, appeared last month.

Investors are excited about Lucid’s prospects: it is a true competitor to Tesla, and critics have praised its new all-electric vehicle, the Lucid Air. The company is due to launch its flagship model, the Air Dream Edition, in the second half of 2021.

Lucid is supported by Saudi Arabia’s sovereign wealth fund, which acquired a 67% stake in the EV maker for about $ 1.3 billion in 2018. Bloomberg reported earlier this year that Lucid was in talks to build an EV factory near the city of Jeddah on the Red Sea.

In December, Lucid completed its first plant in Casa Grande, Arizona, where it expects to produce 400,000 cars annually.

If the merger is successful, it will continue a year of monumental growth for SPACs. They overshadowed traditional IPOs in 2021, accounting for 63% of the nearly $ 77 billion raised on U.S. stock exchanges, according to Bloomberg data.

Churchill Capital IV is one of seven SPACs supported by Klein, a former Citigroup executive. Earlier this month, Klein raised $ 1.6 billion for his sixth and seventh SPACs.

Churchill Capital IV traded 13.06% higher at $ 59.81 at 10:38 am ET.