Lucid Motors is said to near deal to list via Michael Klein’s SPAC

Lucid Motors Inc. is nearing a deal to go public through a merger with a blank-check company started by investment banker Michael Klein that could be announced early this week, according to people familiar with the matter.

The combined entity would be valued at as much as $15 billion, the people said, asking not to be identified because the matter is private. Shares of Churchill Capital Corp IV, the special purpose acquisition company, rose $4.43, or 8.4%, to $57.37 on Monday.

The SPAC has been in talks to raise $1 billion to $1.5 billion from institutional investors to support the transaction, the people said. The valuation and the amount of additional funding could still change based on investor demand.

A deal for the electric-vehicle maker could be announced Tuesday, two of the people said. The talks are ongoing but could still fall apart.

The Churchill Capital SPAC is the largest run by Klein, a former Citigroup Inc. rainmaker, and has raised more than $2 billion for the transaction, the people said. Lucid is backed by Saudi Arabia’s sovereign wealth fund.

A representative for Lucid Motors declined to comment. A representative for Klein couldn’t immediately be reached for comment. The Churchill Capital SPAC has surged more than fivefold since Bloomberg News first reported on the talks last month.

Reuters reported earlier that a deal could be reached as early as this month.

Klein has played a prominent role in guiding the kingdom’s investments, serving as an advisor to its Public Investment Fund. Among other deals, he advised on the Saudi Aramco initial public offering.

Several electric-vehicle makers have done deals with SPACs as start-ups seek to bulk up and raise cash to compete with industry leader Tesla Inc. Lucid would be one of the most established electric-vehicle companies to take this route.

Lucid also would be one of the largest SPAC deals to be announced since the blank-check company rush started, probably beaten only by United Wholesale Mortgage’s merger with Gores Holdings IV Inc., which was valued at around $16 billion.

SPACs have drawn a slew of prominent investors. Michael Dell, activist investor Paul Singer, Facebook Inc. co-founder Eduardo Saverin and former Xerox Corp. chief Ursula Burns all joined the blank-check parade Friday, with at least 13 of these companies filing for U.S. IPOs to raise more than $4.5 billion.

SPACs have come to dominate IPOs this year, accounting for 63% of the almost $77 billion raised on U.S. exchanges, according to data compiled by Bloomberg. Including Friday’s newcomers, 146 SPACs that have filed since Jan. 1 are waiting for IPOs to add $40 billion to that total, the data show.

Lucid is targeting the luxury end of the EV market, and Chief Executive Peter Rawlinson was previously Tesla’s chief engineer on the Model S sedan. Saudi Arabia’s sovereign wealth fund has invested more than $1 billion in the company.

Lucid was founded in 2007 under the name Atieva and spent years being more focused on battery technology than pursuing development of a luxury car. It pivoted in 2016, changing its name to Lucid and beginning work on the Air sedan.

Lucid plans to start deliveries of a $169,000 version of the Air to U.S. customers in the second quarter. The car, which the company says will offer 500 miles of range, will be built at its factory in Arizona. The company plans to offer more affordable versions from 2022 and later will build a battery-electric SUV.

Bloomberg writer Kiel Porter contributed to this report.

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