EV startup Lucid (LCID) revealed it is raising roughly $3 billion through a public stock sale and new investment from its majority stockholder, Saudi Arabia’s Public Investment Fund (PIF).
Lucid raises $3 billion via stock sale
Lucid, like most EV startups, is struggling with rising input costs as it works to ramp production. To make matters worse, falling valuations are making it harder to access cheap funding.
The EV startup produced 2,314 Lucid Air models in the first three months of the year while delivering 1,406, up nearly 300% YOY.
According to the company’s first-quarter results, Lucid generated $149.4 million in revenue while ending the quarter with just over $3.4 billion in cash and around $700 million in credit for $4.1 billion in total liquidity.
Despite Lucid reassuring it would have funding for at least the next year, the EV startup revealed it’s raising around $3 billion through a stock sale; around $1.2 billion will be from the sale of 173.5 million shares of common stock.
Meanwhile, the other $1.8 billion will come directly from its largest shareholder, Saudi Arabia’s Public Investment Fund (PIF). The wealth fund has entered into an agreement to buy 265.6 million shares in a private placement.
The investment is expected to close on June 26, 2023, while PIF will maintain its roughly 60.5% ownership of Lucid common stock. Saudi Arabia’s PIF has invested around $9 billion in the EV startup following the latest funding.
Lucid says it will use the funds for general corporate purposes, including capital expenditures and working capital.
Lucid expects to hit the lower end of its production guidance between 10,000 and 14,000 models in total this year. The EV maker says its first electric SUV, the Gravity, will be unveiled in full to the public later this year as it progresses on phase two of construction at its Arizona facility.
Lucid’s stock dropped over 10% following the news, settling around $6.55 per share.
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