NEWARK, Calif. - Lucid Group, Inc. (NASDAQ:LCID), an electric vehicle manufacturer, has launched a public offering of over 262 million shares of its common stock. The offering will be managed by BofA Securities as the sole underwriter, with shares sold through various methods including the Nasdaq and over-the-counter markets.
Concurrently, Lucid's majority stockholder, Ayar Third Investment Company, affiliated with the Public Investment Fund (PIF), plans to maintain its ownership stake by purchasing approximately 374.7 million shares in a private placement at the public offering price, contingent on the offering's completion. Ayar also has the option to buy additional shares to sustain its 58.8% ownership if the underwriter exercises a 30-day option for nearly 39.4 million more shares.
The proceeds from both the public offering and private placement are earmarked for general corporate purposes, potentially covering capital expenditures and working capital.
This move follows Lucid's effective shelf registration statement on Form S-3 with the Securities and Exchange Commission (SEC), including a base prospectus and a prospectus supplement related to the offering. Interested investors are advised to consult these documents, available on the SEC's website or through BofA Securities, for detailed information about the offering.
Lucid has stated that the press release does not constitute an offer to sell or a solicitation of an offer to buy its common stock in any jurisdiction where such actions would be unlawful without registration or qualification under the applicable securities laws.
This announcement is based on a press release statement from Lucid Group.
In other recent news, Lucid Group has been making significant strides in both operational and financial performance. The electric vehicle manufacturer reported a 32.9% year-over-year increase in revenue, reaching $200.6 million in Q2. In addition, Lucid's vehicle deliveries also rose, with a total of 2,781 vehicles delivered in Q3, surpassing analysts' predictions. Furthermore, Lucid secured a substantial financial agreement with Ayar Third Investment Company, selling 75,000 shares of its Series B Convertible Preferred Stock for $750 million.
Lucid Group also announced a partnership with Four Seasons Hotels and Resorts to offer guests sustainable driving experiences at select hotel properties. As part of the program, guests at participating Four Seasons locations will have the opportunity to drive complimentary Lucid electric vehicles. To support the initiative, Lucid will install electric vehicle charging stations at Four Seasons properties.
In terms of product development, Lucid is focusing on the production of its Gravity SUV, expected to launch later this year. However, analysts from firms such as RBC Capital and Stifel have questioned Lucid's strategy of launching high-end vehicles before entering the mid-size market. CFRA Research analyst Garrett Nelson expressed concerns about Lucid's ability to meet its 2024 production target of 9,000 units.
Regarding analyst ratings, Baird maintained a Neutral rating on Lucid Group Inc. (NASDAQ:LCID) shares with a steady price target of $3.00. RBC Capital maintained its Sector Perform rating and a price target of $3.00 on shares of Lucid Group Inc. These recent developments illustrate Lucid Group's ongoing efforts to enhance its operational and financial performance amid scrutiny from financial analysts.
InvestingPro Insights
Lucid Group's recent move to launch a public offering of over 262 million shares comes at a time when the company faces significant financial challenges. According to InvestingPro data, Lucid's revenue for the last twelve months as of Q2 2023 stands at $668.29 million, with a concerning revenue growth of -11.31% over the same period. This context underscores the importance of the company's efforts to raise capital through the public offering and private placement.
InvestingPro Tips reveal that Lucid is "quickly burning through cash" and "suffers from weak gross profit margins." These insights align with the company's decision to seek additional funding for general corporate purposes, including capital expenditures and working capital. The gross profit margin of -162.6% for the last twelve months as of Q2 2023 further illustrates the financial pressures Lucid is facing.
On a more positive note, one InvestingPro Tip indicates that Lucid "holds more cash than debt on its balance sheet," which could provide some reassurance to potential investors in the public offering. Additionally, the tip that "liquid assets exceed short term obligations" suggests that the company maintains a degree of financial flexibility despite its challenges.
For investors considering Lucid's stock, it's worth noting that InvestingPro offers 12 additional tips that could provide further insights into the company's financial health and market position. These additional tips, available through the InvestingPro product, could be valuable for those looking to make informed decisions about Lucid's stock in light of this public offering.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.