The merger with the corporate shell Churchill Capital IV gave the electric car maker a stock market valuation of 24 billion dollars.
(Photo: Reuters)
Frankfurt A subpoena by the US Securities and Exchange Commission lets the shares of Tesla rival Lucid collapse by up to 19.5 percent. “The investigation appears to relate to the business combination between Churchill Capital IV and Atieva and to certain projections and statements,” said Lucid.
The SEC did not want to comment on their actions. The US authorities are scrutinizing more and more companies that are joining forces with a so-called Special Purpose Acquisition Company (SPAC) for an IPO.
The merger with the corporate shell Churchill Capital IV gave the electric car maker a stock market valuation of 24 billion dollars. After the criminal proceedings against the electric truck manufacturer Nikola, new manufacturers would be scrutinized more closely by the regulatory authorities to protect investors, said analyst Garrett Nelson of the analysis firm CFRA.
In the meantime, the SEC has also launched an investigation against Tesla. The authority reacted to a tip according to which the US electric car manufacturer in its solar division should not have properly informed its shareholders and the public about the risk of fire in defective photovoltaic systems for years. Tesla shares fell by around four percent. Electric car startups like Canoo, Faraday Future and Fisker have also come under pressure.
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And ex-US President Donald Trump has also been targeted by the Securities and Exchange Commission with his new online project. The authority is scrutinizing the company through which Trump wants to bring his social network “TRUTH Social” to the stock exchange. The company called Digital World Acquisition (DWAC) announced on Monday that it had received a request for information from the SEC. Among other things, she asked for information about communication with Trump’s company and looked at the trading in shares of DWAC before its announcement to work with the Trump Media & Technology Group (TMTG).
Spacs are risky
TMTG is to be brought to the US technology exchange Nasdaq through the back door via the merger with Digital World Acquisition. The former Deutsche Bank investment banker Patrick Orlando is behind DWAC. DWAC has raised $ 293 million to be made available to Trump’s new network. DWAC shares were valued at ten dollars in the original deal with Trump Media in October. On Monday they were trading at $ 42.60.
Trump’s Twitter competitor is set to launch in the first quarter of 2022. The so-called Spacs, through which the IPO should be made possible, are not without risk. Investors in the empty shell – in this case DWAC – usually do not know in advance which company the company is merging with. A Spac initiated by the banker Orlando in China recently failed because investors jumped off again.
More: US Securities and Exchange Commission investigates Tesla solar division