Banking

The CEO of Rivian-rival Lucid reveals why he’s hustling to take his EV startup public ASAP: ‘Time is of the essence’

  • Lucid Motors’ CEO said he expects the startup to go public early in the second half of this year.
  • He suggested the company’s SPAC deal could close in July.
  • Lucid stands to raise $4.4 billion from the agreement.

Lucid Motors is close to hitting the public markets with $4 billion in new cash, Peter Rawlinson, the electric-vehicle startup’s CEO, told Insider.

When Lucid agreed in February to merge with the

SPAC
Churchill Capital Corp. IV, the companies said they expected the deal to close by the end of June. Rawlinson said the agreement likely won’t finalize until July, but added that there aren’t any major problems to sort through.

“It’s going to run into next month, but it is on track,” he said. When asked to confirm that July was his expected closing date, he said, “I anticipate early part of the second half” of 2021.

A SPAC, short for “special-purpose acquisition company,” raises money in an IPO with the sole intention of using those funds to buy another firm. Rarely used before 2020, SPAC mergers have since become a more popular route for startups looking to go public, particularly in the EV industry, as they can be faster and more efficient than a traditional IPO. 

Advocates say SPACs give more startups a chance to succeed while offering a broader range of investors the chance to buy into young, high-upside companies when their shares are still relatively inexpensive. But some experts have said the enthusiasm for SPACs has gone too far, and that the people who create SPACs have less to lose than normal investors if their target companies perform poorly.

Convenience was the primary reason Rawlinson opted for a SPAC instead of a traditional IPO. “It’s less hassle,” he said. The deal is expected to bring Lucid around $4.4 billion in cash, a sum more than twice as large as the total amount of money the company had previously raised, according to Pitchbook.

Lucid said on Tuesday that the windfall will allow it to increase its spending on capital investments, including its factory, by as much as 7% through 2026. “Time is of the essence,” Rawlinson said. “We want to accelerate our growth as a serious player.”

The startup plans to begin delivering its first vehicle, the Air luxury sedan, during the second half of this year. It has more than 10,000 reservations for the vehicle and plans to follow it with an SUV, the Gravity, in 2023.

Are you a current or former Lucid employee? Do you have a news tip or opinion you’d like to share? Contact this reporter at [email protected], on Signal at 646-768-4712, or via his encrypted email address [email protected].

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