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The post Lucid Motors Stock Jumps after Closing SPAC Deal appeared first on Millennial Money.
After shareholders of special purpose acquisition company (SPAC) Churchill Capital IV approved the deal last week, Lucid (NASDAQ: LCID) debuted as a public company on Monday after closing the merger on Friday.
There had been a minor delay due to confusion among retail investors regarding one of the proposals that investors voted on, with some shareholders incorrectly believing that a proposal to increase the number of authorized shares would be highly dilutive. Once the company clarified the situation, all of the necessary proposals easily passed.
As of 12:20 p.m. EDT on Monday morning, Lucid stock was up 10%.
A done deal
With the transaction completed, Lucid will receive $4.4 billion in net proceeds that will be absolutely critical in funding future growth. Entering the automotive industry is incredibly capital intensive, and Lucid recently announced that it was accelerating its manufacturing plans that will require an additional $350 million in capital expenditures.
The company is pulling that planned spending forward from future years in order to meet strong demand for its Lucid Air sedan.
“Lucid Air represents the next generation of EVs and creates new standards for interior comfort, range, efficiency and power,” Lucid CEO and CTO Peter Rawlinson commented in a statement. “We are on track to meet our projected deliveries for the next two years, and we look forward to delighting our customers around the world with the best electric vehicles ever created.”
Unlike many electric vehicle (EV) startups that have hit the public market in recent years, Lucid is relatively less speculative as it has already completed the first phase of its manufacturing facility in Arizona that can produce 34,000 vehicles per year.
The next phases will boost production capacity even further as Lucid constructs the rest of the facility. Once completed, the factory will be capable of producing 365,000 units per year.
High hopes
Lucid confirmed that it is on track to begin delivering the first Air cars in the second half of 2021, a timeline that was previously delayed from the spring in order for the company to fine tune product quality.
Investors are pricing in lofty expectations for Lucid, partly in the hope that it can follow in Tesla’s (NASDAQ: TSLA) technological footsteps. At current prices of approximately $26.50, Lucid commands a market cap of $42.3 billion even before delivering a single car to consumers. In comparison, iconic automaker Ford (NYSE: F) is currently worth around $55.7 billion.
In no uncertain terms, Lucid’s EV technology is impressive, as it expects the Air to have a range of over 500 miles thanks to industry-leading efficiency of 4.5 miles per kilowatt hour (kWh). The company’s work on miniaturization is also admirable, allowing the Air’s electric motor to have an incredibly high power-to-weight ratio.
With billions of dollars on the balance sheet and Air cars about to hit the streets, Lucid has a promising road ahead of it.
The post Lucid Motors Stock Jumps after Closing SPAC Deal appeared first on Millennial Money.
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