Hey guys, it's sasha and i've just invested 2 200 in the shares of something called the churchill capital corporation 4.. Now i am planning to invest a lot more into them over the coming weeks, taking my total to well over 10 000. In a short space of time, my portfolio is only about eighty thousand dollars in total, so this is a very big chunk of money for me and the likelihood is most of you watching probably have no idea what churchill capital four ticker cciv on the new york Stock exchange actually is well. Let me tell you what it is.

Let me tell you why i'm investing in it, why i'm super excited by it, but just before i do a really brief disclaimer. I am not a financial advisor. I cannot provide financial advice to you if you do need financial advice, please go and find somebody who is qualified to provide it to you. This video is purely for informational purposes.

I am investing in this company and this is my personal reason. My personal opinion as to why i'm making that investment - it is only that it is just my view now. Cciv is what is called a spac. It stands for a special purpose acquisition vehicle.

It is a special type of company that does absolutely nothing. It is just one giant pile of cash, it doesn't make anything, it doesn't sell anything, it doesn't earn any money and in fact there are many many of these companies. There are literally hundreds of these that are listed on the exchanges. These packs go through the long and complicated process of actually getting listed on the stock exchange and the sole reason that they do.

This is so that then, after they do get listed as they go public over the next two year period, they go and make an acquisition of a company. It is basically an easier way for the companies that are looking to go and list on the stock exchange to list there without all the time and all the effort spent and actually in some cases it can help them go and raise those funds a lot more Quickly now, in the case of cciv, they have announced that they are in the process of acquiring a company called lucid motors, which, incidentally, has not sold a single car or earned any money yet either. So why am i placing a big bet on this? Well, let me tell you first, let me explain the mechanics of this particular deal so that you understand a little bit more about how it works. Spax have specific rules about how they operate.

They typically have this rule where they issue shares that are worth ten dollars. When they first go public and until there is some announcement about what the spac might actually invest their money in, they usually remain roughly at that 10 mark. In the case of cciv the moment that news began emerging that they might be acquiring lucid, their price began dancing around and it was up and then it was down and as i'm recording this video, the shares are worth about twenty dollars. But that is not all.

As part of this deal, the ccib spak is not the only company that will be investing into lucid. In fact, the deal has a number of other institutional investors that are also putting their money into the same deal and those investors are getting their shares at a fixed price of 15, with companies like blackrock fidelity, then saudi arabia, public investment fund and others investing a Total of 2.5 billion dollars - this is something called a pipe which is a private investment in public equity, and so those companies are putting two and a half billion dollars in and cci v. Investors like myself, are basically getting a share of 2.1 billion dollars alongside that. Well, 2.07 billion and those 2.07 billion are nominal shares at 10, each so there's 207 million shares available for people like me to buy so the total amount of money going into lucid from this deal is going to be 4.6 billion dollars.

So as the share price is currently 20, that essentially means you're, paying double the nominal price of the share, so double the amount that will actually go to lucid at the end and you're paying about 33 more for those shares than the institutional investors are paying at The same time, so it doesn't sound very good right. One really important thing to remember as well as part of this deal is that the pipe investors, those big institutional investors, are not allowed to sell their shares until the 1st of september 2021.. So when this deal completes and is due to complete in the next few weeks that i'm going to talk about in just a second, they can go and cash in when the merger actually happens, but still it doesn't sound. Very good right.

Well, here is why i am investing according to the information cciv and lucid have submitted to the sec. The deal is expected to complete in the second quarter of 2021. So that's in the next few weeks, no later than the end of june 2021., once the deal closes, there'll be a few changes. The shares will be renamed to lucid group and they're, saying that you're going to be getting two shares per one, that you've invested money in not that that makes any real difference and you will own shares in this new lcid ticker on the new york stock exchange.

Now lucid has not sold a single car yet and i don't normally invest in companies that are valued based on hype, but, in my opinion, lucid is very much not based on hype. In fact, i think it's hugely undervalued, but just another brief disclaimer, i'm investing in this company. So this is just my view and as an investor i may be biased, so please go and do your own research, please make sure you go and check any numbers. Please make sure you don't take any of this as gospel.

This is just me sharing my opinion. Lucid was founded back in 2007 and initially planned to be just a parts manufacturer for other makers of electric vehicles, but almost 10 years later the company decided to go for it and renamed itself. At that point, as lucid motors some point in 2016., a lack of funding almost killed this company, so they actually came very close to the brink, but a big investment of one billion dollars from the public investment fund of saudi arabia in 2019 gave it a big Kick and now the company is getting this huge extra cash injection through this reverse merger process. Lucid already has a huge, modern factory that exists that is today standing there in arizona they've just released another video where they show the production line, which is pretty much complete and they're, showing the final test of the end-to-end run of that production line, because they are Expecting to begin manufacturing and delivering cars in the next few months, they're saying that in q2, they're going to begin manufacturing and selling vehicles so we're right on the brink and the best thing here is.

They have plans to significantly increase the size of this factory and the production line that comes with the incoming investment as well as potentially then opening new factories and other geographical locations around the world. As the company scales. One thing i really like is: they have a very reasonable and i'd say, modest, set of targets for selling these cars. They start in 2021, they're only planning to sell 20 000 of these cars in the whole of 2022 ramping up to 250 000 cars by 2026..

So what i like about this is this makes a lot of sense. It is sensible, they're not trying to pretend they're going to be doing stuff that they will never be achieving. I really really like this, but how good is this, and what return could this possibly get? Well, i'm a product guy and lou said for me takes a lot of my boxes in terms of what kind of company i really like investing in. They have a really solid business plan that makes a huge amount of sense to me.

They are already at the starting line of beginning to be able to produce and manufacture the cars which is far further than some other companies that have come to this point. In terms of going public, and certainly in my opinion, have a product that makes a lot more commercial sense as well, their electric cars can genuinely compete. The longest range of cars they're planning to produce starting from this year can do over 500 miles on a single charge and they're targeting the more premium end of the market, which i think is good. They understand the type of customer they want to target and they're trying to compete with luxury brands like mercedes-benz on the global platform.

They also know what they are doing, which is hugely important. Their ceo is a chap called peter rollinson brit, who previously had jobs as chief engineer at jaguar chief engineer at lotus and really importantly, chief engineer at tesla from 2009 to 2013, where he was the guy responsible for designing the model. S, which is what gave tesla everything that it has today and rollinson, has hired a bunch of smart people from across the automotive industry, including people like derek jenkins, for example, who's very well known for designing the fourth generation mazda mx-5, which got huge amounts of praise And then volkswagen sirocco amongst a bunch of other things, so the right talent is there, the money is there, the factory is there and the expertise on how to make electric cars is also there. So the paper valuation of the company based on this deal is 24 billion dollars.

Now that sounds like a lot for a company that has never sold a single car right. Gm, for example, has a market cap of 82 billion dollars, and that is a huge multinational company. That's been around for quite a while, but here's the thing. A lot of people compare new ev manufacturers to existing car companies, and i just don't think that that is the right way to think about it.

Here are a few reasons why first off the global market for car manufacturers is enormous. It is huge you do not need a giant market share in order to do exceptionally well in the space. My projection for tesla, which quadruples their current share price, assumes a car market share of less than four percent in ten years time now, traditional manufacturers have a lot of baggage, which is another reason they have hundreds of factories that produce ice cars, internal combustion engine cars. They have loads and loads of employees that are skilled and that have been manufacturing those cars.

They have existing vehicles, millions of them on the roads that require servicing that require powers being manufactured. The electric car business for them is a fraction of one percent of their total business, so how much attention can they really be putting on it and because they have all of this baggage to deal with? It will take them necessarily a lot of time to go and pivot their business and i'm not saying that none of them will do well. I am sure that a lot of them will actually do really really well in ev market, but that doesn't matter because it only takes a small number of them to not go and switch to not do well to take too long for that gap to open up. For companies like lucid and tesla to actually come through, and that is what i am excited by look at coach builders when cars first came about at the end of the 19th century.

Many of them tried to pivot, but very few actually did and very few of those were actually successful. Few of today's successful car companies came from those coach builders. The majority of the successful ones actually started out focusing on cars. At that precise point in time now, the car business for lucid alone, in my opinion, can easily reach the level where tesla is right.

Now, i'm not even talking beyond right now in the next 10 years. I actually think they probably will get there sooner, but if they do just reach the point where tesla is today and the valuation of tesla today is about 715 billion dollars. That will already give me more than 10 times return on my investment, which i am going to be perfectly happy with, but can i go bigger than that? I genuinely think so to me. These guys can go and emerge as being a very healthy competitor, pure ev competitor, to tesla on this market, and i love a bit of competition between two companies that are focused on something that can propel both of them to go and rise within the industry and Take the whole industry with them, so i am hugely excited by it.

There's a lot of macro things that might affect this as well. Joy biden has just announced a huge commitment to reduce carbon emissions by 50 by 2030, which is just nine years in the future, and this type of news is only going to continue given the global focus on climate change. So i expect there to be a massive load of government grants, tax cuts and other benefits both to ev manufacturers and the people buying those cars from them. It is really important to note that there definitely are big risks in this investment and by saying big i am not overstating it.

There are big risks here. The deal is not yet complete and although now the papers have been fired with the sec, they filed all the forms um somewhere in the middle of march. There is still a chance, it might be a low chance, but there's still a chance. The deal will fall through then there is a risk that the company has not ace, sold a single vehicle.

Yet is their factory actually as good as they say and as they show, i know, there's a risk that it isn't do they actually know what they're doing do they actually have the technology? Can they really deliver on their potential? What, if other ev manufacturers or traditional automakers outpace them and take all the wind out of their sails? What if they just never build their factories, never reach their potential? What if they don't scale enough to work on the valuation? There are a lot of risks as to whether they will ever actually turn a profit, but for me this is a huge opportunity to invest in a company that i think, has the capacity to deliver mind-boggling results in my investment over the next decade. I am fine with the risk for me, the potential here is quantifiable. I can build a model. I can assess what my view on the valuation is and where i think they might be going in the next 10 years, and my valuation on this is so big that i absolutely want a massive piece of it as much as i reasonably can put into it.

I think that this is an opportunity to potentially invest in something like what tesla was when you could first invest in them, and we all know what happened with the share price of tesla since then, if you're, investing in lucid or if you completely disagree with what I have to say, please make sure you leave a comment below i'd, be really interested to hear your opinions and your views. Thank you so much for watching i'll, really really appreciate and as always i'll see you guys later, you.