Lucid Raises $1.1 Billion Through Convertible Notes Offering, Boosts Strategic Position

U.S.-based electric vehicle (EV) manufacturer Lucid Group, which is majority-owned by Saudi Arabia’s Public Investment Fund (PIF), has successfully completed a $1.1 billion convertible senior notes offering due in 2030, as part of its strategy to strengthen liquidity and reduce existing debt obligations.

In a statement on Tuesday, Lucid confirmed that approximately $935.6 million of the net proceeds will be used to repurchase nearly $1.05 billion in outstanding convertible notes originally due in 2026. The offering also included a $100 million additional purchase option exercised by initial buyers, reflecting investor confidence in the company’s outlook.

“This offering better positions Lucid for future growth and success while minimizing the impact on existing shareholders,” said Lucid’s Chief Financial Officer, Taoufiq Boussaid. “The support of the PIF continues to be one of Lucid’s key strategic differentiators as we work toward a more sustainable future.”

The financing move follows Lucid’s strong first-quarter performance, with the company reporting deliveries of 3,109 vehicles — a 58% increase from the same period in 2024.

The new capital was raised through convertible senior notes — a hybrid financial instrument that allows holders to convert debt into equity at a later date. Lucid used $118.3 million of the proceeds to fund “capped call” transactions, which effectively raised the conversion price of the notes to $4.80 per share, double the company’s closing share price of $2.40 on April 2. This mechanism is designed to minimize potential dilution of existing shareholders’ stakes.

“The capped call transaction helps us protect shareholder value by limiting the number of new shares that may be issued in the event of a conversion,” the company stated.

In addition, the PIF supported the transaction through a prepaid forward share purchase agreement, giving Lucid immediate capital while allowing the fund to acquire equity at a later date. This further underscores the PIF’s commitment to Lucid, which it has backed as a cornerstone of its broader strategy to diversify Saudi Arabia’s economy and invest in sustainable technologies.

Convertible senior notes, the instrument used in this offering, are considered higher-priority debt and offer greater protection to investors in case of liquidation. The company retains flexibility to settle conversions in cash, shares, or a mix of both.

Lucid said the remaining funds from the offering will be used for general corporate purposes, as it continues to scale up operations and expand its footprint in the competitive EV market.

With this latest capital raise, Lucid appears to be shoring up both financial and strategic positions, reinforcing its long-term growth trajectory while maintaining shareholder confidence.