Churchill Capital slides 40% as deal for Lucid Motors confirmed By Investing.com

By Samuel Indyk

Investing.com – Lucid Motors has finally agreed to go public in a deal worth $24bln with blank cheque company Churchill Capital IV Corp (NYSE:CCIV). Lucid Motors, which is majority owned by Saudi Arabia’s sovereign wealth fund, is still yet to deliver a car, however, they forecast deliveries of around 20,000 vehicles next year, generating sales of $2.2bln.

Churchill Capital IV

The deal has seen the share price in Churchill Capital IV decline 40% in pre-market trade. The SPAC, set up by renowned dealmaker Michael Klein, has had an enormous rally since reports of a reverse merger with Lucid Motors began to surface in January, rising from $10 to a high of $64.86.

The agreement announced late last night includes a $2.5bln private placement in public equity (PIPE), the largest of its kind on record for a deal with a SPAC.

The transaction is expected to close in the second quarter. Upon closing, the company ticker will convert from CCIV to LCID.

Speaking about the deal, Lucid Motors said going public “will accelerate our efforts to introduce the most advanced electric vehicles in the world.”

Financials

Alongside the deal, Lucid published an investor presentation, detailing their outlook for the coming years.

Despite the company not yet delivering a car to a customer, they said they expect almost $23bln in revenue by 2026, rising from an expected $2.2bln next year.

The company is not expected to have positive EBITDA until 2024 and is not expected to be cash flow positive until 2025.