Electric vehicle manufacturer Lucid Motors announced Tuesday that it will finally be going public through a merger with a special-purpose acquisition company, or SPAC.
The Tesla rival said that it has already agreed to merge with SPAC Churchill Capital Corp. The deal is the latest in a growing number of SPAC mergers, which is now the hottest trend on Wall Street.
Churchill Capital and Lucid Motors said that they will be merging at a transaction equity value of $11.75 billion. The two companies said that they have already secured several private investments. The companies said that they will be selling at $15 per share, implying a valuation of roughly $24 billion.
The private investment in a public equity deal, or PIPE deal, is expected to provide Lucid Motors with up to $4.4 billion in fresh capital.
Like all SPACs, Churchill listed at a per-share price of $10. The stock immediately surged following reports of discussions between the company and Lucid Motors. On Monday, the stock surged in early morning trading. It then corrected and dipped by more than 25% in after-hours trading, closing at $57.37 per share.
"Lucid is going public to accelerate into the next phase of our growth as we work towards the launch of our new pure-electric luxury sedan, Lucid Air, in 2021 followed by our Gravity performance luxury SUV in 2023," Lucid Motors' chief executive officer, Peter Rawlinson, said in a statement.
The company said that the proceeds from the transactions will be used towards its planned expansion, which will include the establishment of a new factory in Arizona. The factory is expected to be the first greenfield purpose-built EV manufacturing facility in North America.
Lucid Motors said that once the deal is completed, it plans to more than double its U.S.-based workforce from 2,000 to 5,000 workers by the end of 2022.
The SPAC deal is expected to add additional heavy-hitting investors to the company. This includes additional investments from Saudi Arabia's Public Investment Fund, which has expressed interest in joining the PIPE deal.
Under the PIPE deal, investors will agree not to sell their shares in the company until Sept. 1 or when the shares are registered. Existing investors in the company will also need to agree to a six-month lockup.