Lucid Group, Inc. Announces Pricing of Public Offering of Common Stock and Corresponding Investment by an Affiliate of PIF for Aggregate Gross Proceeds of Approximately $1.67 Billion

Rhea-AI Summary

Lucid Group (Nasdaq: LCID) has announced the pricing of its public offering of 262,446,931 shares of common stock. The offering is expected to close on October 18, 2024. Additionally, Lucid's majority stockholder, Ayar Third Investment Company, an affiliate of the Public Investment Fund (PIF), has agreed to purchase 374,717,927 shares in a private placement at the same price. This private placement is set to close on October 31, 2024.

The combined public offering and private placement are expected to generate aggregate gross proceeds of approximately $1.67 billion. Lucid plans to use the net proceeds for general corporate purposes, including capital expenditures and working capital. BofA Securities is acting as the sole underwriter for the public offering.

Positive

• Lucid Group is raising approximately $1.67 billion in gross proceeds
• The company's majority stockholder, Ayar, is maintaining its 58.8% ownership through additional share purchases
• Funds will be used for general corporate purposes, including capital expenditures and working capital

Negative

• The public offering and private placement will result in significant shareholder dilution
• Large-scale stock offerings may negatively impact the share price in the short term

Insights

Financial Analyst

This announcement represents a significant capital raise for Lucid Group, with aggregate gross proceeds of approximately $1.67 billion. The offering consists of two parts: a public offering of 262,446,931 shares and a private placement of 374,717,927 shares to Ayar, an affiliate of PIF. This substantial influx of capital is important for Lucid's operations and future growth.

Key points to consider:

• The capital raise strengthens Lucid's balance sheet, providing essential funds for operations, R&D and potential expansion.
• PIF's continued support through Ayar maintains their 58.8% ownership, signaling confidence in Lucid's long-term prospects.
• The dilutive effect of this offering on existing shareholders is significant and may impact short-term stock price.
• Lucid's ability to secure this funding in the current market environment is noteworthy, indicating investor interest despite challenges in the EV sector.

While the capital infusion is positive for Lucid's financial stability, investors should closely monitor how effectively the company utilizes these funds to drive growth and achieve profitability in the competitive EV market.

Market Research Analyst

This capital raise comes at a critical juncture for Lucid and the broader EV market. Here's what investors should consider:

• Timing: The EV market is facing headwinds with slowing demand and increased competition. Lucid's ability to secure funding now could provide a competitive advantage.
• Market Perception: The substantial investment, particularly from PIF, may boost investor confidence in Lucid's long-term viability.
• Industry Trends: This move aligns with the trend of EV startups requiring significant capital to scale production and weather the current market challenges.
• Competitive Positioning: The additional funds could help Lucid accelerate its product development and market expansion plans, potentially improving its position against rivals like Tesla and traditional automakers.

Investors should watch for Lucid's strategic moves post-funding, including any announcements on production ramp-up, new model developments, or market expansion plans. These will be key indicators of how effectively the company leverages this capital injection to strengthen its market position.

NEWARK, Calif., Oct. 17, 2024 /PRNewswire/ -- Lucid Group, Inc. (Nasdaq: LCID; "Lucid") announced today that it priced its underwritten public offering of 262,446,931 shares of its common stock. The underwriter may offer the shares of common stock from time to time for sale in one or more transactions to purchasers directly, through agents or through brokers in brokerage transactions on Nasdaq, in the over-the-counter market, through negotiated transactions or in a combination of such methods, or otherwise at a fixed price or prices, which may be changed, at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices. The public offering is expected to close on or about October 18, 2024, subject to customary closing conditions.

Lucid has granted the underwriter a 30-day option to purchase up to 39,367,040 additional shares of its common stock.

BofA Securities is acting as the sole underwriter for the public offering.

In addition, Lucid has entered into an agreement with its majority stockholder and affiliate of the Public Investment Fund ("PIF"), Ayar Third Investment Company ("Ayar"), pursuant to which Ayar has agreed to purchase 374,717,927 shares of common stock from Lucid in a private placement, at the same price per share initially paid by the underwriter in the public offering. The private placement is expected to close on October 31, 2024 and is subject to completion of the public offering and customary closing conditions. As a result of these purchases, Ayar expects to maintain its approximate 58.8% ownership of Lucid's outstanding common stock. In addition, Ayar has agreed to purchase from us, in the event that the underwriter exercises its option, additional shares of our common stock to maintain its ownership of Lucid's outstanding common stock, and an additional closing for such purchase would be held 10 business days after the underwriter's exercise of its option.

Lucid intends to use the net proceeds from the public offering, as well as from the private placement by its majority stockholder, for general corporate purposes, which may include, among other things, capital expenditures and working capital.

The public offering is being made pursuant to Lucid's effective shelf registration statement on Form S-3, including a base prospectus, filed with the Securities and Exchange Commission (the "SEC") and a prospectus supplement relating to the public offering. Prospective investors should read the prospectus supplement and the accompanying base prospectus in that registration statement and other documents that Lucid has filed or will file with the SEC for information about Lucid and the public offering. You may obtain these documents for free by visiting EDGAR on the SEC's website at www.sec.gov. Alternatively, copies of the prospectus supplement and the base prospectus may be obtained from BofA Securities, Inc., NC1-022-02-25, 201 North Tryon Street, Charlotte, NC  28255-0001, Attn: Prospectus Department, or by email at dg.prospectus_requests@bofa.com.

This press release does not constitute an offer to sell or the solicitation of an offer to buy shares of Lucid's common stock, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

About Lucid Group
Lucid is a Silicon Valley-based technology company focused on creating the most advanced EVs in the world. Lucid's goal is to accelerate humanity's transition to sustainable transportation and energy through the creation of the most advanced EVs.

Investor Relations Contact
investor@lucidmotors.com

Media Contact
media@lucidmotors.com

Trademarks
This communication contains trademarks, service marks, trade names and copyrights of Lucid Group, Inc. and its subsidiaries and other companies, which are the property of their respective owners.

Forward-Looking Statements
This communication includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "project," "forecast," "intend," "will," "shall," "expect," "anticipate," "believe," "seek," "target," "continue," "could," "may," "might," "possible," "potential," "predict" or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding plans and expectations with respect to Lucid's registration statement on Form S-3, use of proceeds and the closing of the public offering and the private placement to Lucid's majority stockholder, any potential future offering or capital raises, the promise of Lucid's technology, and the goal of Lucid. These statements are based on various assumptions, whether or not identified in this communication, and on the current expectations of Lucid's management. These forward-looking statements are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and may differ from these forward-looking statements. Many actual events and circumstances are beyond the control of Lucid. These forward-looking statements are subject to a number of risks and uncertainties, including those factors discussed under the heading "Risk Factors" in Part II, Item 1A. of Lucid's Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, as well as other documents Lucid has filed or will file with the SEC. If any of these risks materialize or Lucid's assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that Lucid currently does not know or that Lucid currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Lucid's expectations, plans or forecasts of future events and views as of the date of this communication. Lucid anticipates that subsequent events and developments will cause Lucid's assessments to change. However, while Lucid may elect to update these forward-looking statements at some point in the future, Lucid specifically disclaims any obligation to do so, except as may be required under applicable securities laws. These forward-looking statements should not be relied upon as representing Lucid's assessments as of any date subsequent to the date of this communication. Accordingly, undue reliance should not be placed upon the forward-looking statements.

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SOURCE Lucid Group

FAQ

How many shares is Lucid Group (LCID) offering in its public offering?

Lucid Group (LCID) is offering 262,446,931 shares of common stock in its public offering.

What is the expected closing date for Lucid Group's (LCID) public offering?

The public offering is expected to close on or about October 18, 2024, subject to customary closing conditions.

How much is Lucid Group (LCID) expected to raise from the combined public offering and private placement?

Lucid Group (LCID) is expected to raise approximately $1.67 billion in aggregate gross proceeds from the combined public offering and private placement.

Who is the underwriter for Lucid Group's (LCID) public offering?

BofA Securities is acting as the sole underwriter for Lucid Group's (LCID) public offering.

How will Lucid Group (LCID) use the proceeds from the offering?

Lucid Group (LCID) intends to use the net proceeds for general corporate purposes, which may include capital expenditures and working capital.