Lucid Group, Inc., backed by the Saudi Public Investment Fund (PIF), has successfully closed a significant $1.1 billion offering in convertible senior notes due in 2030. This closing includes the full exercise of an option that allowed initial purchasers to acquire an additional $100 million in notes, as stated in an official announcement.

Taoufiq Boussaid, the chief financial officer at Lucid, expressed satisfaction with the completion of this offering, highlighting that it positions Lucid for future growth and strengthens its partnership with the PIF, while minimizing any impact on existing shareholders. He noted that the PIF’s support continues to be a strategic advantage for Lucid as they work towards sustainability.

As part of the offering, Lucid has purchased capped call hedges that are intended to increase the effective conversion price of the notes to $4.80 per share of Lucid’s Class A common stock. This price reflects a premium of 100 percent compared to the last reported sale price of $2.40 per share on The Nasdaq Global Select Market on April 2, 2025. The capped call transactions are expected to help mitigate potential dilution or cash obligations when the notes are converted.

The net proceeds from this offering amount to approximately $1 082 million after accounting for initial purchasers’ discounts, commissions, and estimated offering expenses. Of this amount, around $118 million was allocated to cover costs associated with the capped call transactions. Additionally, approximately $935 million will be used to repurchase about $1 052 million in outstanding 1.25 percent convertible senior notes due 2026, with the remaining funds earmarked for general corporate purposes.

Lucid has the flexibility to settle any future conversions in cash, shares of its Class A common stock, or a combination of both. This strategic approach aims to further manage any potential dilution or cash obligations that could arise from future conversions of the notes.