Rivian Automotive will make its market debut on Wednesday in what is expected to be one of the largest IPOs of the year.
The electric vehicle maker valued its stock above the expected range of $ 78 per share on Tuesday to raise approximately $ 11.9 billion. At that asking price, Rivian is valued at $ 66.5 billion, making it a little less valuable than traditional auto giants like GM and Ford.
The stock is traded on the Nasdaq under the symbol RIVN.
Rivian, backed by Amazon and Ford, has generated strong interest from investors looking to capitalize on the rapidly growing EV market.
Amazon has a 20% stake in Rivian. The company invested more than $ 1.3 billion in the young automaker prior to going public. Ford and Cox Automotive each hold more than 5% of the shares in Rivian.
While Ford executives have described their relationship with Rivian as a strategic investment, the company’s Lincoln division had previously planned to build electric vehicles with the upstart. Those plans were abandoned amid the emerging pandemic.
Amazon, which is switching its fleet to vehicles powered by renewable energy, announced in 2019 that it is buying thousands of vehicles from Rivian. Recent filings show that Amazon has exclusive rights to Rivian’s battery-electric delivery vehicles for at least four years, with a right of first refusal thereafter.
Amazon has ordered 100,000 vehicles from Rivian by 2030. The companies plan to have 10,000 new Rivian-Amazon delivery vehicles on the streets by next year.
In addition to its fleet business, Rivian has launched Tesla, GM and Ford with an all-electric pickup truck, the R1T. According to an October prospectus, a battery-electric SUV for seven passengers, the R1S, will be launched in December.
Rivian CEO RJ Scaringe, who holds a Ph.D. from Sloan Automotive Laboratory at the Massachusetts Institute of Technology, Rivian founded in 2009. The company is headquartered in Irvine, California and has a vehicle assembly plant in Normal, Illinois.
The company says its Illinois factory has a capacity of up to 150,000 vehicles per year. About 65,000 of these should be R1 pickups and SUVs, and about 85,000 should be the company’s commercial RCV vans, Rivian said in the financial filings.
But Rivian is still a relative upstart and has yet to generate any real revenue. Rivian said in its prospectus that the company will lose up to $ 1.28 billion in the third quarter, while sales will be between $ 0 and $ 1 million.
It has also not yet produced its electric vehicles in very large numbers. It’s not clear how quickly production can ramp up, especially given the global chip scarcity and port restrictions that have plagued automakers this year.
Rivian announced in an addendum to its S-1 filing that it has an order backlog of 55,400 R1T and R1S vehicles from customers in North America and plans to deliver them by the end of 2023.
New laws awaiting President Joe Biden’s signature will provide $ 7.5 billion in federal grants to build a national network of EV charging stations, and Rivian could benefit from it. Scaringe emphasized that Rivian vehicles are ideal for people with a thirst for adventure and a love of nature. Therefore, the company places charging stations in remote locations such as states or national parks.
Rivian had 6,274 employees at the end of June this year.
One of his former executives recently sued Rivian, accusing the company of having a “toxic bro culture” of unfairly quitting her job, costing her “millions of dollars in uninvested equity on the eve of the company’s IPO”.
In the lawsuit, Laura Schwab, who previously directed Aston Martin’s US operations, also alleges that the company has dismissed concerns it raised about Rivian’s business, including its “ability to deliver on its promises to investors.”
SEE: EV maker Rivian sets IPO ahead of IPO above expected range