Stifel sees PIF affiliate investment as ‘a plus’ for Lucid’s shares

Stifel notes Lucid entered into a subscription agreement with Ayar Third Investment Company, an affiliate of the Public Investment Fund, to purchase 100,000 Series A Convertible Preferred Stock for $1.0 billion in a private placement. The preferred stock is initially convertible into roughly 278.15 million common shares for a conversion price of $3.5952, equivalent to roughly 12% of Lucid’s issued and outstanding common stock. Stifel believes upon conversion, the PIF’s position would increase to roughly 64.1% of Lucid’s outstanding shares. The company exited 2023 with $4,784 million in total liquidity which management believed was sufficient to fund operations into 2025. In the firm’s view, the deal highlights PIF’s commitment to Lucid’s strategy and is a plus for the shares. Stifel has a Hold rating on the shares.