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Lucid Air sedan. Image courtesy of Lucid Motors.

The electric vehicle startup Lucid Motors is going public via merger with the special purpose acquisition company Churchill Capital Corp IV at a valuation of $24 billion, the companies said Monday.

Why it matters: The high value of the transaction with the blank-check firm headed by former Citi exec Michael Klein underscores how Lucid could be well positioned in the growing market.

  • The Silicon Valley-based company, whose CEO Peter Rawlinson is a Tesla alum, is beginning deliveries this year of its Lucid Air sedan.
  • The company says the luxury vehicle will have over 500 miles of range, the highest in the industry.
  • It's also backed by Saudi Arabia's huge sovereign wealth fund.

Were it stands: Investors in the deal in include the Saudi fund as well as funds and accounts managed by BlackRock, Fidelity Management & Research LLC, Franklin Templeton, and others, the announcement states.

  • Via Bloomberg, it's the "largest injection of capital into Lucid since Saudi Arabia’s Public Investment Fund invested more than $1 billion in 2018."
  • CCIV stock was trading after the announcement at $42 per share, implying a valuation for Lucid of $67 billion

What's next: The announcement said the deal will provide Lucid with $4.4 billion in proceeds that will be used to expand Lucid's manufacturing plant in Arizona, which Lucid plans to scale up in phases.

  • Beyond the phased-in growth of Lucid Air production, the company plans to bring an SUV into production in 2023.
  • "Scheduled to expand over three phases in the coming years, our Arizona facility is designed to be capable of producing approximately 365,000 units per year at scale," the announcement states.
  • The proceeds will also help Lucid implement plans to become a tech supplier for other auto manufacturers, and enter the stationary battery storage market.

Go deeper

Ben Geman, author of Generate
Feb 22, 2021 - Economy & Business

Xos to go public at $2 billion valuation as electric SPAC wave rolls on

Illustration: Sarah Grillo/Axios

Xos Inc., an electric truck company that counts UPS among its customers, said this morning that it's going public at a $2 billion valuation via a reverse merger with NextGen Acquisition Corp.

Why it matters: The California-based Xos' deal is the latest in a wave of electric vehicle companies going public via mergers with special purpose acquisition companies, signaling heavy investor interest in the sector.

D.C.-Beijing tensions are shifting markets

Illustration: Aïda Amer/Axios

U.S. markets stand to lose $2 trillion in value if D.C. and Beijing drift further apart.

Why it matters: Political chasms are showing up in new securities regulations that put companies and investors in a bind. The rules are also another reflection of how much relations between the world’s largest economies have cooled, even as they remain economically interdependent. 

49 mins ago - Health
Axios Investigates

Documents reveal the secrecy of America's drug pricing matrix

Illustration: Aïda Amer/Axios

American businesses spend hundreds of billions of dollars a year on prescription drugs, and the bills keep getting bigger. But some of the companies promising to help rein in those costs prevent employers from looking under the hood.

Why it matters: Documents provided to Axios reveal a new layer of secrecy within the maze of American drug pricing — one in which firms that manage drug coverage for hundreds of employers, representing millions of workers, obscure the details of their work and make it difficult to figure out whether they're actually providing a good deal.