Aston Martin Lagonda Global Holdings said Monday that it intends to enter into a strategic supply agreement with Lucid Group for the creation of ultra-luxury high-performance electric vehicles.
Lucid shares jumped 7.7% in premarket trading Monday.
The U.K. luxury-car maker said that both companies will enter into a supply and integration agreement which will give Aston Martin access to Lucid's technology, which includes powertrains and battery systems.
The company said the agreement also complements the bespoke development of a battery electric vehicle, or BEV, platform which will be used across its future electrified product portfolio. It will also support the launch of its first BEV which is targeted for 2025.
The company said it will issue 28.4 million new ordinary shares to Lucid, which it said is equivalent to $100 million and will see Lucid become a shareholder of around 3.7%. It said Lucid has agreed not to dispose of the consideration shares for a year from the date of their allotment.
Aston Martin will also make certain phased cash payments to Lucid for $132 million, with an initial amount of $33 million, and that under the terms of the agreement it committed to a minimum spend with Lucid on powertrain components of $225 million, as well as a $10 million integration fee.
"Along with Mercedes-Benz, we now have two world-class suppliers to support the internal development and investments we are making to deliver our electrification strategy," Executive Chairman Lawrence Stroll said.