PIF, the Saudi Arabian sovereign wealth fund that Tesla Inc CEO Elon Musk has stated could assist him fund a $72 billion deal to take his automaker private, is looking forward to invest in aspiring Tesla competitor Lucid Motors Inc, people knowledgeable with the matter stated on Sunday.
The discussion between privately-held Lucid Motors and PIF emphasize the latter’s appetite to fund the electric automakers to diversify the oil-rich country’s investment portfolio.
A deal with Lucid would also be more in line with PIF’s limited resources, since, despite its $250 billion in assets, PIF has already made enough commitments to other technology companies or investments, consisting of a $45-billion agreement to invest in a giant technology fund headed by Japan’s SoftBank Group Corp.
PIF and Lucid have drawn up a term sheet under which PIF could fund over $1 billion in Lucid and gain majority ownership, the sources stated. PIF’s first investment in Lucid Motors, however, would be for $500 million, and subsequent money injections would come in two stages that are dependant on Lucid Motors hitting certain production milestones, one of the sources said.
The discussion between the two companies PIF and Lucid Motors, may not result in a deal, the sources echoed.