(Bloomberg) -- The blank-check company seeking to buy electric-car startup Lucid Motors Inc. made a last-minute appeal for retail shareholders to vote for the deal amid signs that it’s struggling to win their approval.
Churchill Capital Corp. IV, the special purpose acquisition company started by investment banker Michael Klein, adjourned its Thursday shareholder meeting that was to determine the fate of the merger, pushing the decision back to the following day. It also appealed again in a new statement for shareholders to sign off on the deal. Churchill’s shares fell as much as 4.8% before retracing about half the loss.
“The company still needs additional votes to obtain approval for that proposal by a majority of its outstanding shares,” according to the statement. “As a result, the meeting has been adjourned to obtain the required votes.”
The two companies are trying to woo the very investors who pushed Churchill’s shares up more than 130% this year, including individual holders who are new to investing and who may not bother to vote their relatively small stakes. To an extent, it’s another case of Wall Street having to adjust to disruptions caused by novice traders, whose influx has fueled and sometimes collided with the boom in SPAC deals.
In an investor update shortly after the meeting was adjourned, Klein addressed investors who may have picked up shares in Churchill via trading platforms such as Robinhood.
“We welcome all of the new shareholders,” Klein said. “However, we need you to participate in the election process. In particular, if you are participating from the new trading platforms, the new apps that may not necessarily be directing you clearly to a voting service, we need your vote,” Klein said. He added that the process “literally takes one minute.”
Multiple notices have been sent to shareholders, with Lucid Chief Executive Officer Peter Rawlinson singling out Robinhood users “with those diamond hands” in a video posted to social media earlier this week. The voting deadline was extended Thursday morning just hours before the meeting was set to take place. Churchill also asked investors who were holders of record to vote even if they’ve already sold their shares.
Churchill’s announced merger with Lucid in February was then the largest proposed SPAC deal ever. The stock surged more than 500% at one point, bid up amid enthusiasm for the green revolution and the waning of the internal combustion engine.
But Lucid delayed the start of production more than once over the course of the pandemic as it faced industry-wide supply-chain issues and quality-control concerns. Rawlinson has said Lucid is on track to start production for customer deliveries in the second half of 2021.
Rawlinson, who spoke after Klein from a factory in Arizona, said the team was “energized about going into full production mode” later this year and reiterated Klein’s plea to shareholders.
The last proposal that needs approval will complete a business combination that “provides me with that crucial financing that I need to grow and propel this great company,” Rawlinson said. “I want to be super clear about this, I need you to vote.”
(Updates with appeal to Robinhood traders starting in the fifth paragraph)
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