PIF-Backed Lucid Motors Raises $1.1B to Refinance Debt
US electric vehicle manufacturer Lucid Group, which counts Saudi Arabia's Public Investment Fund (PIF) as its majority owner, has secured $1.1 billion in new funding through an offering of convertible senior notes due in 2030. This strategic financial move is primarily aimed at refinancing existing debt, providing the EV maker with greater financial flexibility as it continues to scale production.
Strategic Debt Refinancing
Lucid stated that approximately $936 million of the net proceeds from the $1.1 billion note offering will be used to repurchase around $1.05 billion worth of its existing convertible senior notes that were due in 2026. By issuing new notes due in 2030 to buy back notes due in 2026, Lucid effectively extends a significant portion of its debt maturity by four years. This provides the company with more operational runway before facing major repayment deadlines. The transaction also involved capped call transactions intended to reduce potential dilution for existing shareholders upon future note conversion.
PIF's Continued Backing Amid Challenges
This funding manoeuvre comes amidst ongoing financial challenges for Lucid, which reported significant losses in 2024 (around $3.1 billion) and saw the departure of its CEO Peter Rawlinson in February 2025 (Marc Winterhoff is interim CEO). However, the company also reported a positive sign with Q1 2025 deliveries up 58% year-over-year to 3,109 vehicles.
The Public Investment Fund (PIF) has been a steadfast supporter of Lucid since its initial investment in 2018 and holds a majority stake (reports range from ~58% to potentially higher including affiliates). PIF's affiliate, Ayar Third Investment Company, has injected substantial capital previously, including $1 billion in March 2024 and up to $1.5 billion announced in August 2024. This latest funding round, although structured as debt refinancing, further underscores PIF's continued commitment.
Implications for Lucid & KSA's EV Ambitions
Securing this $1.1 billion allows Lucid to better manage its balance sheet and reduces near-term financial pressure. It reflects sophisticated financial management supported by its principal backer, the PIF. This continued support is crucial not only for Lucid's operations (including its factory in King Abdullah Economic City, Jeddah) but also aligns with Saudi Arabia's Vision 2030 goals to diversify its economy and become a significant player in the electric vehicle manufacturing landscape.
About Lucid Motors
Lucid Group, Inc. (Nasdaq: LCID) is an American electric vehicle company founded in 2007, initially focused on battery technology before pivoting to vehicle production. Headquartered in California, it produces the luxury electric sedan, the Lucid Air, known for its long range (over 500 miles). Lucid has manufacturing facilities in Arizona, USA, and Jeddah, Saudi Arabia, and also supplies powertrain technology to other automakers like Aston Martin.
About Saudi Public Investment Fund (PIF)
The Public Investment Fund (PIF) is the sovereign wealth fund of the Kingdom of Saudi Arabia, ranking among the largest in the world with assets under management approaching $1 trillion. Established in 1971, PIF is the main engine driving Saudi Arabia's economic transformation under Vision 2030, investing domestically and internationally across 13 strategic sectors to diversify the economy, localize technology, and create jobs. It holds significant stakes in numerous global companies, including its majority ownership of Lucid Motors.
Looking Ahead
While Lucid still faces the significant challenge of ramping up production towards its 2025 guidance of approximately 20,000 vehicles and managing cash burn to reach profitability, this debt refinancing provides crucial breathing room. The continued strong backing from its majority shareholder, PIF, remains a critical factor in Lucid's ability to navigate the competitive EV market and execute its long-term plans, including the upcoming launch of its Gravity SUV.
Source: AGBI