Tesla shares of an empty-check company that is set to merge with electric-car maker Lucid Motors after a deal to take on rival public.
Churchill Capital Corp IV – a special-purpose acquisition company, or SPAC, backed by former Citigroup banker Michael Klein – dropped 32 percent at 8:57 am after confirming Lucid’s nearly $ 12 billion merger. 38.78 dollars.
Monday’s announcement followed strong speculation last week of pushing Churchill shares to a high of $ 64.86, where it was more than six times higher than when it began trading in September.
The deal would provide Lucid with an investment of $ 4.6 billion and a $ 24 billion investment to the company. This includes $ 2.1 billion in cash from Churchill and $ 2.5 billion in private investment in public equity or PIPE, financing from investors led by Saudi Arabia’s Public Investment Fund.
PIPE was invested at a per-share price of $ 15 – where Churchill’s stock was trading before the merger became official.
Churchill “believes that Lucid’s superior and proven technology is supported by a clear demand for a sustainable [electric vehicles] Make Lucid a highly attractive investment for Churchill Capital Corp IV shareholders, many of whom focus on sustainability, ”said Klein Statement
Lucid said that going public will help to accelerate its growth as it works to launch its electric Lucid Air luxury sedan this year. The model boasts an estimated battery range of 500 miles and can go from zero to 60 MPH in less than 2.5 seconds.
The Silicon Valley-based company says it expects to speed up delivery of air in the second half of 2021. It is also expanding an Arizona factory where it plans to eventually produce about 365,000 vehicles annually.
Lucid CEO Peter Rawlinson said in a statement, “This transaction further enables the realization of our vision to supply Lucid’s advanced EV technologies to third parties such as automotive manufacturers as well as other automotive manufacturers is.”
Tesla took notice when Lucid cut Air’s starting price to $ 69,900 in October. CEO Elon Musk responded by trimming the price of Tesla’s high-end Model S sedan to $ 69,420 – a reference to jokes about sex positions and marijuana that often pop up in his Twitter feed.
He said, “The gauntlet has been thrown down!” The prophecy will be fulfilled, ”Musk tweeted at the time.
With post wires
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