Lucid filed for a new offering of up to $8 billion

[HC_79]

Lucid Group Inc (LCID.O) on Monday filed for a new offering of up to $8 billion as the luxury electric-vehicle maker looks to beef up working capital at a time when supply snarls have crimped its production.

EV maker Lucid files for new offering to raise $8 bln in stages

Lucid Group Inc on Monday filed for a new offering of up to $8 billion as the luxury electric-vehicle maker looks to beef up working capital at a time when supply snarls have crimped its production.

www.reuters.com

 

[noobzilla]

stock gonna drop, get out while early and then buy back later

 

[bhramabull]

stock gonna drop, get out while early and then buy back later

My average is around $22. So won't be selling but I don't see it as anything terrible

 

[Impatient7536]

for those with more financial/wall street knowledge, if Lucid and the PIF made an $8 billion capital injection deal, would they still have to do this announcement and go down this route? or, for a lack of a better term, would a wire transfer of $8 billion in exchange for x more existing shares be sufficient?

trying to figure out if this is a offering where lucid will be at the mercy of the market accepting these new securities for capital injection, or if it's just a formal announcement, but the PIF will probably be the one buying like 90% of it.

 

[Tesla2.0]

for those with more financial/wall street knowledge, if Lucid and the PIF made an $8 billion capital injection deal, would they still have to do this announcement and go down this route? or, for a lack of a better term, would a wire transfer of $8 billion in exchange for x more existing shares be sufficient?

trying to figure out if this is a offering where lucid will be at the mercy of the market accepting these new securities for capital injection, or if it's just a formal announcement, but the PIF will probably be the one buying like 90% of it.

It would be shares equity dilution. But if PIF is willing to buy more than 62% of new offering and the market tank, PIF is increasing its risk but gaining equity % at further discount.

Regardless, for Lucid to have new offering, it was confidently planned, their business development so far this year seems quite fearless to me as they have very deep pocket contrary to their book. They are rather forward looking for long term than the short term emphasis on production delivery.

 

[magesh]

stock gonna drop, get out while early and then buy back later

Ughhh. Got some last week based on the delivery numbers, VIN assignments, video flyovers, etc. Just an overall feel that things are getting better or at least , looking up. And Q3 will be better than Q2.

Bham. Then they announce this and lose several points.

 

[HC_79]

Ughhh. Got some last week based on the delivery numbers, VIN assignments, video flyovers, etc. Just an overall feel that things are getting better or at least , looking up. And Q3 will be better than Q2.

Bham. Then they announce this and lose several points.

Yeah, I was thinking the same. Couldn’t get much lower and then this happened! Damn it!!

 

[DeaneG]

Yeah, I was thinking the same. Couldn’t get much lower and then this happened! Damn it!!

Could still go down by $15.15. I'm betting not - but am still waiting for the planned recession that seems to be needed to deflate things a bit.

 

[magesh]

In other (un)related news, LIV golf just signed up Cameon Smith as well. Dustin Johnson went over there earlier & LIV is building its inventory by spending $$$$.

LIV & LCID are both 'sponsored' by PIF and maybe they are diverting funds to LIV,

LCID is on its own to get funding now? But that will dilute PIF holdings, unless this is obligatory filing & PIF is picking up the majority of the $8bn, as @Impatient7536 suggested?

I *really* hope Peter demonstrates better Q3 numbers than Q2.

 

[HC_79]

If Lucid can’t get 6,000 cars out this year and show promising Q3 numbers then surely questions will be asked on how competent the management team are. It will show it’s more than just supply chain problems. Rivian went from 50,000 to 25,000 using the supply chain constraints reasoning and is on track to achieve it so Lucid has no excuses at 6,000 cars especially when they’re more vertically integrated than Rivian.

 

[n8236]

What reasons does a co have to do this?

 

[hydbob]

If Lucid can’t get 6,000 cars out this year and show promising Q3 numbers then surely questions will be asked on how competent the management team are. It will show it’s more than just supply chain problems. Rivian went from 50,000 to 25,000 using the supply chain constraints reasoning and is on track to achieve it so Lucid has no excuses at 6,000 cars especially when they’re more vertically integrated than Rivian.

While it's great that Rivian can deliver that number, isn't a good chunk if not more than 50% of that, the Amazon delivery vans? Aren't those much less complex and easier to manufacture than the R1T or R1S?

 

[ac.bill]

[sigh]
This is not an offering. It is registration of new shares that may be offered at any time over the next 3 years. These shares or some portion of them may be offered to the public or used in other fundraising efforts. Read the S-3 for yourself.

All OEMs are investing billions building EV factories. Lucid probably has the funds on hand to finish out the AMP-1 Phase 2 expansion but will quickly need to start on Phase 3. The land for Phase 3 has already been secured. That is where the mid-size vehicles (think Model 3/Y) will be made. The Saudi assembly plant for building cars from parts made in AMP-1 has not started yet. Lucid is opening showrooms and building service centers in the US, Canada, and Europe. All of this costs money. As a shareholder I would rather see this funded through share issues than through debt, especially in a time of rising interest rates.

If any of this is news to you, you have not been doing due diligence. For an overview of Lucid's business plan I recommend the "Investor Presentation July 2021" PDF available under Presentations on the Lucid Motors investor relations webpage. While there has been some drift since then due to vendor issues, the financial and scheduling impact of that drift has been modest. Overall Lucid Motors is on schedule to meet its 2026 goal of solid free cash flow.

 

[ac.bill]

What reasons does a co have to do this?

Growth.
Lucid will be raising funds over the next several years (the shares registered today can be sold at any time over the next 3 years, but are not being sold today). Lucid is building an entire car company from scratch, factories, distribution networks, showrooms, service centers, while adding staff and making the public aware of the brand. All of those things take money.

 

[digiboxer]

JMO...but this announcement is the proverbial N-Burger. On the last earnings call the CFO acknowledged what everyone already knew: the company will run out of cash in mid-'23 and will need to borrow more, or find people to invest more (or a combination).

What they announced today is that all the legal/regulatory red tape has been filed so that L can move quickly to raise more $$ when the conditions look favorable

Disclaimer --- not a sec lawyer...

 

[Pwmac]

Hopefully they release some good news when they start selling the shares.

 

[magesh]

What reasons does a co have to do this?

My $0.02/-: Its for future growth & hedge towards capital needs in the next few qtrs/years. They are getting primed by these disclosures, to get ready if they need to. If PIF funding fails, they have a fall back with these filings for immediate public capital raise.

Or Sugar Daddy, PIF, may bail them out and all will be well in 'Wunder'land.

 

[ac.bill]

My $0.02/-: Its for future growth & hedge towards capital needs in the next few qtrs/years. They are getting primed by these disclosures, to get ready if they need to. If PIF funding fails, they have a fall back with these filings for immediate public capital raise.

Or Sugar Daddy, PIF, may bail them out and all will be well in 'Wunder'land.

PIF is the largest shareholder. If they feel the need to inject more cash themselves they could either buy some of these shares or lend cash through their line of credit. These shares could also be used to redeem existing or future convertible bonds issued by Lucid.

 

[limtless]

What reasons does a co have to do this?

Avoid bankruptcy and having no cash. They are burning money.

 

[Tesla2.0]

In 9 years, $19 Billion Raised And $9 Billion Of Negative Cash Flow for Tesla​

$; mm	’10	’11	’12	2013	2014	2015	2016	2017	’10-’18
Capital Raised
common stock	269	231	221	360	0	730	1.701	400	3,914
debt	0	72	204	666	2,300	319	2,853	7,138	13,552
stock options	1	11	25	95	100	107	164	259	762
warrants				120	389			53	562
TOTAL	270	314	451	1,242	2,790	1,156	4,719	7,850	18,790
Cash Flow
operating loss	-147	-251	-394	-61	-187	-717	-667	-1,632	-4,057
deprec.	11	17	29	106	232	423	947	1,636	3,400
capital exp.	40	198	239	262	970	1,635	1,280	3,415	8,042
operating CF