Lucid Group Announces $875 Million Convertible Notes Offering

New updates have been reported about Lucid Group (PC:LUCID)

Lucid Group, Inc. has announced the pricing of its $875 million convertible senior notes due 2031, targeting qualified institutional buyers. The notes, which carry a 7.00% annual interest rate, are set to settle around November 17, 2025, pending customary closing conditions. Lucid has also provided initial purchasers an option to acquire an additional $100 million in notes. These unsecured notes will mature on November 1, 2031, with conversion rights for holders under specific conditions before August 1, 2031. Post this date, conversions can occur at any time until two days before maturity, with Lucid settling conversions in cash, stock, or a combination thereof. The initial conversion rate is set at 48.0475 shares per $1,000 principal, translating to a conversion price of approximately $20.81 per share, a 22.5% premium over the recent Nasdaq closing price.

Lucid plans to use approximately $752.2 million of the net proceeds to repurchase outstanding 1.25% Convertible Senior Notes due 2026, with the remainder allocated for general corporate purposes. Concurrently, Ayar Third Investment Company, a subsidiary of PIF, has engaged in a prepaid forward transaction to acquire $636.7 million of Lucid’s common stock, potentially influencing the market price of Lucid’s shares. This move is part of a broader strategy to manage Lucid’s capital structure and financial obligations effectively. The company has filed a Current Report on Form 8-K with the SEC for further details. This financial maneuvering is crucial for Lucid as it navigates its growth trajectory in the competitive EV market, aiming to bolster its financial standing and support its strategic initiatives.