PIF makes billions on its investment in Lucid Motors

PIF put $1 billion into Lucid in 2018, giving it a majority stake in the California-based company when it was at the early stages of designing advanced luxury electric cars. (Supplied)
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PIF put $1 billion into Lucid in 2018, giving it a majority stake in the California-based company when it was at the early stages of designing advanced luxury electric cars. (Supplied)
PIF makes billions on its investment in Lucid Motors
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PIF makes billions on its investment in Lucid Motors
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Updated 24 February 2021

PIF makes billions on its investment in Lucid Motors

PIF put $1 billion into Lucid in 2018, giving it a majority stake in the California-based company when it was at the early stages of designing advanced luxury electric cars. (Supplied)
  • Saudi stake in Californian electric vehicle maker is proving a profitable step

DUBAI: The Public Investment Fund, Saudi Arabia’s premier investing institution, has seen a multi-billion dollar increase in the value of its investment in Lucid Motors, the fast-growing Californian electric vehicle manufacturer, as a result of recent transactions.

PIF put $1 billion into Lucid in 2018, giving it a majority stake in the California-based company when it was at the early stages of designing advanced luxury electric cars. With the first model, the Air, unveiled and set for first delivery this year, that stake is now worth a lot more.

In a complex financial transaction recently unveiled in the US, Lucid will merge with a special purpose acquisition company, or SPAC — a company specifically designed to get an initial public offering (IPO) and a valuation on a stock market.

The SPAC involved with Lucid is Churchill Capital Corp IV, a creation of investment banker Michael Klein, who is well known for his investment advisory work in the Kingdom, including the record-breaking IPO of Saudi Aramco in 2019.

The SPAC deal gives Lucid a formal valuation of $24bn, and the PIF remains the majority investor in the new set-up.




The Public Investment Fund, Saudi Arabia’s premier investing institution, has seen a multi-billion dollar increase in the value of its investment in Lucid Motors. (Supplied)

The PIF declined to give a detailed breakdown of the value of its investment, but the documents published in the SPAC transaction show it at around $15bn - and will possibly be worth a lot more once vehicles start being sold.

Shares in Churchill gyrated wildly in the days before the deal with Lucid was formally announced but settled well above the value at which PIF and other big investors bought into the company.

The influential Lex column of the Financial Times said: “The biggest winner is Lucid’s largest current shareholder, Saudi Arabia’s PIF.”

Peter Rawlinson, the chief executive of Lucid who formerly worked at rival electric car company Tesla, told journalists: “I think that the valuation is a reflection of our technology.”

Electric vehicles have been one of the big investment themes of the past year, with Tesla — the market leader — soaring to a market capitalization of $670bn, bigger than all the traditional car manufacturers combined and making its founder, Elon Musk, one of the richest men in the world.




Peter Rawlinson, the chief executive of Lucid Motors. (Supplied)

Rawlinson is unfazed by Tesla’s size or reputation. Last year, in the run up to the launch of the Air, he told Arab News: “We’ve got the best car in the world, but I’m more excited to know that we have technology that can cascade down to more affordable models for the man in the street. That’s what is going to change the world.”

For the PIF, the investment in Lucid is a demonstration of the value of its approach of taking strategic stakes in foreign companies. Last year, it spent $10bn buying US and European equities when they slumped in value after the pandemic crash, which it later sold when markets recovered.

There could also be an industrial benefit from the PIF-Lucid relationship. There has been increasing speculation that Rawlinson will choose Saudi Arabia as the first location for a manufacturing facility, with a site near Jeddah mentioned as a possible production plant.

Rawlinson said of PIF: “They put their faith in us, that’s why we’re here today thriving.”

The deal with Churchill will give Lucid the capital it needs to go into full-scale production of the Air from a new production facility in Arizona, and to move plans forward for an electric SUV.


British Muslim billionaire brothers buy healthy fast food chain

British Muslim billionaire brothers buy healthy fast food chain
Updated 18 April 2021

British Muslim billionaire brothers buy healthy fast food chain

British Muslim billionaire brothers buy healthy fast food chain
  • The deal includes 42 company-owned restaurants, as well as 29 franchise sites
  • The brothers said the firm was a “fantastic brand we have long admired”

LONDON: Britain’s billionaire Issa brothers have bought healthy fast food chain Leon.
More than 70 Leon restaurants across the UK and Europe have been sold for £100 million ($138 million) to EG Group, the petrol station business founded by Mohsin and Zuber Issa, the Financial Times reported.
The deal includes 42 company-owned restaurants, as well as 29 franchise sites, which are mainly found in airports and train stations across the UK and some European countries.
The brothers said the firm, which has been hit badly by the coronavirus pandemic, was a “fantastic brand we have long admired.”
Reports said the group has committed to keeping Leon’s management team and staff the same.
“We have tried hard, done some good things, made a healthy amount of mistakes, and built a business that quite a few people are kind enough to say that they love,” John Vincent, who co-founded Leon in 2004, said.
Speaking about the brothers, he said: “They have been enthusiastic customers of Leon, going out of their way to eat here whenever they visit London.”
“They are decent, hard-working business people who are committed to sustaining and further strengthening the values and culture that we have built.”
In October 2020, the Issa brothers and private equity firm TDR Capital, agreed to buy a majority stake in Asda from Walmart.
The brothers and TDR own EG Group, a global convenience and petrol station retailer, which trades from more than 6,000 sites across 10 countries.


Dubai completes first phase of e-commerce free zone

Dubai completes first phase of e-commerce free zone
Updated 18 April 2021

Dubai completes first phase of e-commerce free zone

Dubai completes first phase of e-commerce free zone
  • It includes 470,000 square feet of real estate
  • The e-commerce sector in the Gulf is booming with the forced closure of bricks and mortar shops during the pandemic giving the industry a further boost

DUBAI: The first phase of a new Dubai fee zone dedicated to e-commerce has been completed.
It includes 470,000 square feet of real estate.
The 3.2 billion dirhams ($871 million) Dubai CommerCity project also includes 145,000 square feet of e-commerce logistics units and warehouses in a cluster managed and operated by Hellmann Worldwide Logistics and DHL.
It has leased 51 percent of the logistics warehouses to companies operating across IT, fashion, jewelry and electronics.
“The launch of Dubai CommerCity aims to lead the future of e-commerce business in the region,” said Sheikh Ahmed Bin Saeed Al-Maktoum, chairman of the Dubai Airport Freezone Authority. “The project has been thoroughly studied not only to provide foundational solutions, but also to stimulate and support business and prosperity at a time when the sector is going through peak growth.”
The e-commerce sector in the Gulf is booming with the forced closure of bricks and mortar shops during the pandemic giving the industry a further boost.
The free zone provides opportunities for manufacturers, distributors and global e-retailers while offering tax and investment incentives, it said.
It is divided into three main clusters — Business, Logistics and Social.


Emirates NBD, Etihad Credit Insurance ink deal to ease trade finance access for UAE businesses

Emirates NBD, Etihad Credit Insurance ink deal to ease trade finance access for UAE businesses
Updated 18 April 2021

Emirates NBD, Etihad Credit Insurance ink deal to ease trade finance access for UAE businesses

Emirates NBD, Etihad Credit Insurance ink deal to ease trade finance access for UAE businesses
  • The deal will help the UAE lender to reduce any risks that may be associated with credit facilities

DUBAI: UAE export credit company, Etihad Credit Insurance (ECI), has signed an agreement with Emirates NBD to improve liquidity of UAE exporters by easing their access to credit facilities.
The deal will help the UAE lender to reduce any risks that may be associated with credit facilities, so businesses can pursue export and expansion opportunities, according to a joint statement.
More than 80 per cent of world trade relies on trade finance, ECI’s chief Massimo Falcioni said, and the agreement will allow Emirates NBD to offer innovative financial solutions to their clients.
Governments in the Gulf have been investing in strengthening local businesses as a strategy to recover from the COVID-19 pandemic, and to gradually veer away from oil-dependence.

 

 


Italian fashion brand Diesel launches online shopping platform in KSA, UAE

Italian fashion brand Diesel launches online shopping platform in KSA, UAE
Updated 18 April 2021

Italian fashion brand Diesel launches online shopping platform in KSA, UAE

Italian fashion brand Diesel launches online shopping platform in KSA, UAE
  • The website will feature new collections of the fashion line, as well as exclusive deals for online shoppers

DUBAI: Italian fashion retailer Diesel has launched its own e-commerce platform for customers in Saudi Arabia and the UAE, the company said on Sunday.
The website will feature new collections of the fashion line, as well as exclusive deals for online shoppers. It will also offer free shipping for customers in both countries.
Diesel has been in the market for four decades and is known for its denim and casual fashion offerings.
The COVID-19 pandemic has created huge demand for online shopping in the Gulf, with many retailers accelerating their digital efforts to take advantage of it


Kuwaiti coffee delivery app raises $10m in new funding

Kuwaiti coffee delivery app raises $10m in new funding
Updated 18 April 2021

Kuwaiti coffee delivery app raises $10m in new funding

Kuwaiti coffee delivery app raises $10m in new funding
  • The funding was provided by Kuwaiti listed investment house Al Imtiaz Investment Group
  • COFE was conceived in 2017 by Kuwait-based founder Ali Al-Ebrahim, developed in Silicon Valley and launched in 2018

DUBAI: Kuwaiti coffee delivery app COFE has raised $10 million in new funding, which it aims to use to scale up its operations in Kuwait, Saudi Arabia, the UAE and the UK and to expand into Egypt and Turkey.
The funding was provided by Kuwaiti listed investment house Al Imtiaz Investment Group. COFE was conceived in 2017 by Kuwait-based founder Ali Al-Ebrahim, developed in Silicon Valley and launched in 2018.
“From its early days, COFE has shown tremendous potential as a unique offering that caters to discerning coffee connoisseurs and their consumption habits, while helping to grow and transform revenue streams for vendors. Our partners have recognized this and are confident in our ability to serve existing customers and vendors, while expanding into new markets,” Al-Ebrahim said in a press statement.
Zev Siegl, a co-founder of international coffee chain Starbucks, is also an adviser to COFE. “I am happy to collaborate with the COFE App team and proud of the success and development they’ve achieved,” Siegl told the Mubasher website in April 2019. “During my stay in Kuwait, I visited more than 20 coffee shops and I was impressed by the high level of service, innovation and the high demand on coffee shops which ensure that the COFE app market will keep on growing and will reach the international market very soon.”