"US version of Xiaopeng" Lucid will merge with SPAC: former Tesla engineer continues to serve as CEO

On the morning of February 23, Beijing time, it was reported that Lucid Motors, an electric car manufacturer, will become a public company listed on the New York Stock Exchange. The company will complete the listing through a $4.4 billion transaction.

According to a joint statement issued by Lucid and the acquiring company Churchill Capital Corp IV, the transaction was led by existing investors PIF, BlackRock, Fidelity Management, Franklin Templeton, Neuberger Berman, Wellington Management and Winslow Capital. The two companies stated that the transaction price of the allotment was US$15 per share, equivalent to approximately US$24 billion in pro forma equity value. The combined company’s transaction equity value is $11.8 billion.

In addition, Lucid currently employs nearly 2,000 employees and is expected to add 3,000 employees in the United States by the end of 2022. Peter Rawlinson (Peter Rawlinson) will continue to serve as Lucid's CEO and Chief Technology Officer.

It is reported that none of the existing investors of Lucid Motors will sell their stocks and implement a 6-month lock-up period on the stocks they hold. So far, the company has no liabilities.

In after-hours trading that day, Churchill shares fell by up to 26%, and the stock closed at $57.37 that day. The transaction between the two companies is expected to be completed in the second quarter of this year.

Lucid is headquartered in California, USA. Later this year, the company will launch its first luxury electric car, Lucid Air, with a cruising range of 500 miles, or 804 kilometers. In 2023, the company will also launch a pure electric SUV.

Lucid is merging with a bad check company (SPAC) run by financier Michael Klein, and the combined entity is valued at $24 billion. A number of electric car manufacturers have already completed the listing through the merger with SPAC, and Lucid's deal is the largest among them. Recently, in order to satisfy investors' appetite for electric vehicles, a large number of related companies have sought to go public.

For a long time, Lucid has avoided direct comparison with the electric car leader Tesla, but after the listing, the competition between them and Tesla will inevitably become more intense. The transaction also confirmed previous media reports that the company is seeking $4.4 billion in cash, and they plan to use the funds to market their vehicles and expand their plants in Arizona.

In recent times, due to the skyrocketing of Tesla's stock price, investors have developed a great investment interest in electric car manufacturers and have begun to look for the "next Tesla." In this context, many electric vehicle manufacturers and next-generation automotive technology suppliers have benefited, and Lucid is one of them.

Lucid’s valuation may not be worth mentioning when compared with Tesla’s market value of nearly $690 billion, but for an automaker that has not yet started to officially produce vehicles, it’s already very impressive. Not bad. The company's CEO Rawlinson has repeatedly stated that Lucid is not a direct competitor of Tesla because its product prices exceed the mass market consumers that Elon Musk is eager to reach.

However, there are signs that the competition between the two companies is gradually emerging. Lucid headquarters is only 16 miles, or 25.7 kilometers, from Tesla headquarters. Its first electric car is very close to the Tesla Model S in terms of cruising range. Lucid's new factory is located in the desert of Arizona, and its construction speed is comparable to that of Tesla's China factory. People are more and more interested in this company and the company's CEO, which will definitely make Musk feel threatened.

There is a complicated history between Rawlinson and Musk. The Lucid CEO used to be the chief engineer of Tesla’s Model S, but after he left to start his own business, Musk downplayed his role in the development of the car. He also accused him of “the situation in 2012” on Twitter. When it gets hard" choose to leave Tesla.