Lucid shares pare losses after rebuffing bankruptcy rumors
Investing.com -- Lucid Group Inc. shares were trading roughly 20% lower on Tuesday, paring some of earlier losses of as much as 55%, after the EV maker rebuffed earlier reports of a potential bankruptcy filing.
In an emailed statement to Bloomberg, the company admitted that it is working with restructuring adviser AlixPartners, but said that rumors of a potential bankruptcy filing "are completely false," adding that AlixPartners is only "assisting in improving execution" and that the adviser has not recommended bankruptcy.
Earlier Tuesday, eletric-vehicles.com reported the company was evaluating restructuring options.
The report, which triggered multiple volatility trading halts, said that restructuring adviser AlixPartners has been asked to present its findings to Lucid’s board before its next meeting.
The strategic options under consideration include taking the Saudi-backed electric vehicle maker private or filing for Chapter 11 bankruptcy protection, the report said.
Bloomberg later echoed the reporting, adding the carmaker aims to optimize its business, reduce costs and ensure successful rollout of a new mid-size vehicle.
The company has stated it has sufficient cash to operate into the second half of next year and has depended on support from Saudi Arabia’s Public Investment Fund, Lucid’s largest shareholder, to fund operations as it introduces new models.
Shares of Rivian Automotive Inc., Lucid’s peer U.S. EV maker backed by Amazon, fell roughly 3% following the report.