Lucid Motors, an EV maker targeting the luxury segment, will merge with a special-purpose acquisition company to go public in a deal worth $11.75 billion, valuing the company at $24 billion.

Reuters reported that the deal involves an investment of $2.1 billion from the SPAC, Churchill Capital IV Corp, and a private investment in public equity worth $2.5 billion from a number of investors.

Reports that Lucid Motors was planning to go public first emerged in January, with the Los Angeles Times recalling how the Saudi government had saved the company from going under with a cash injection of $1.3 billion. The report went on to say both the Saudi backers of the company and its board members stood to reap hefty gains from a listing deal.

The size of the combined company’s value is the latest proof of an exceptionally bullish market for electric vehicle shares. Recall the listing of Nikola—another EV startup that also listed through a merger with a SPAC—which saw the company’s shares skyrocket in the first days of trading.

However, the Nikola story, if anything, is a cautionary one as problems began surfacing soon after its stock market debut. Yet it hasn’t so far dampened investors’ appetite for EV shares.

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Lucid Motors is run by a former Tesla engineer and will initially target the high-end EV market with its Lucid Air, scheduled for launch in the second half of this year. This is a slight delay on original plans to release the luxury sedan in the spring of this year. Still, delays of this sort are nothing extraordinary in the industry as market leader Tesla has proved time and again.

The company will manufacture the cars at its factory in Arizona, whose first phase Lucid only finished last year. During this phase, the factory will have the capacity to produce 30,000 cars per year, eventually ramping up to 400,000.

By Irina Slav for Oilprice.com

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