For months, investors bought the stock on rumors of a deal, sending the share price surging, only to sell off sharply once news broke that the Michael Klein-backed SPAC would merge with the luxury EV maker.
The Newark, California-based Lucid Motors combined with Churchill Capital Corp. IV at a transaction equity value of $11.75 billion and a pro-forma equity value of $24 billion.
The transaction included a cash contribution from CCIV of $2.1 billion, and a PIPE investment of $2.5 billion, as well as a lock-up provision that "binds holders well beyond closing."
Shares of the SPAC Churchill Capital Corp. IV originally soared roughly 600% after a Jan. 11 report from Bloomberg said the company was in talks to take the EV maker public.
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Investors flocked to the blank-check firm amid a run on electric vehicles stocks, which are set to benefit from a "Biden Administration and Blue Senate green tidal wave," according to analyst Dan Ives of Wedbush Securities.
Lucid's efficient battery tech that CEO Peter Rawlinson has said is "more advanced technology than Tesla" also drew in investors, despite valuation concerns for the company that has yet to produce revenues from operations.
With prices starting at $77,400 ($69,900 after the US federal tax credits) Lucid is setting its sights on the luxury end of the elecric car market. The company is starting sales with its luxury models including the Air Dream Edition.
"I'm a great believer that the first product defines the brand in the way the Tesla model S defined Tesla as a brand," the CEO said.
After the Dream Edition rollout, Lucid expects to release its Gravity performance SUV by 2023. Helping the company do just that is a state-of-the-art Casa Grande, Arizona EV factory that will eventually produce roughly 365,000 vehicles annually.
Shares of CCIV fell nearly 20% on Wednesday, dropping under the $30 per share mark for the first time since February 4.
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