Photographer: David Paul Morris / Bloomberg
Photographer: David Paul Morris / Bloomberg
Lucid Motors Inc. is approaching a deal to go public through a merger with a blank check company initiated by investment banker Michael Klein, which could be announced early next week, according to people familiar with the matter. of the subject.
The combined entity will be valued at up to $ 15 billion, the sources said, asking not to be named because the matter is private.
The special-purpose acquisition company is in talks to raise between $ 1 billion and $ 1.5 billion in financing from institutional investors to support the transaction, people added. The valuation and the amount of additional financing may still change based on investor demand.
A deal for the electric vehicle maker could be announced on Tuesday, two people said. Negotiations are ongoing, but they may still fail.
Klein, a former rain maker from Citigroup Inc., will use Churchill Capital Corp IV, its largest SPAC that raised more than $ 2 billion, for the transaction, people said. Lucid is supported by the Saudi Arabian sovereign wealth fund.
Photographer: Andrew Harrer / Bloomberg
A Lucid Motors representative declined to comment. A Klein representative could not be reached immediately for comment.
Churchill Capital Corp IV has increased more than five times since the first Bloomberg News reported on the negotiations last month.
Reuters reported last week that a deal could be reached later this month.
Klein threw a prominent role in orienting the kingdom’s investments, acting as advisor to its Public Investment Fund. Among other deals, he advised on Saudi Aramco’s initial public offering.
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Several electric vehicle manufacturers closed deals with SPACs as startups seek to raise and raise money to compete with the industry leader Tesla Inc. Lucid would be one of the most established electric vehicle companies to follow this path.
Lucid would also be one of the largest SPAC deals to be announced since the start of the race, probably beaten only by the merger of United Wholesale Mortgage LLC with Gores Holdings IV Inc., valued at around $ 16 billion.
SPAC Fashion Show
SPACs have also attracted a number of important investors. Michael Dell, investing activist Paul Singer, Facebook Inc. co-founder Eduardo Saverin and former head of Xerox Corp. Ursula Burns participated in the blank check parade on Friday, with at least 13 of these companies filing for IPOs in the U.S. to raise more than $ 4.5 billion.
SPACs have come to dominate IPOs this year, accounting for 63% of the nearly $ 77 billion raised on US exchanges, according to data compiled by Bloomberg. Including Friday’s newcomers, 146 SPACs who have filed for shares since January 1 are expecting IPOs to add $ 40 billion to that total, the data show.
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Lucid targets the luxury segment of the market and its CEO, Peter Rawlinson, was previously Tesla’s chief engineer on the Model S sedan. Saudi Arabia’s sovereign wealth fund has invested more than $ 1 billion in the company.
The company was founded in 2007 under the name Atieva and has spent years focusing more on battery technology than on developing a luxury car. She spun in 2016, changed her name to Lucid and started working on what would become her main model, the Air.
Lucid plans to start delivering a $ 169,000 electric sedan to customers in the United States in the second quarter. The Air EV, which the company says can travel more than 500 miles on a single charge, will be built at a factory in Arizona. It plans to offer more affordable versions of the Air starting in 2022 and will later build a battery-powered electric SUV.
– With the help of Kiel Porter