Electric vehicle maker Rivian's IPO may raise as much as $11.9bn

Amazon-backed company's market debut is the biggest first-time share sale this year

Electric vehicle maker Rivian Automotive priced shares in its initial public offering at $78 apiece to raise about $11.9 billion, the biggest first-time share sale this year.

Backed by deep-pocketed companies such as Amazon and Ford Motor, Rivian is hitting the public markets as it looks to make a dent in the EV market led by Tesla.

Rivian sold 153 million shares in the offering, according to a statement confirming an earlier Bloomberg News report. The $11.9bn haul is the sixth-largest on a US exchange, data compiled by Bloomberg show.

The IPO comes as Rivian delivered its first vehicles, mostly to its own employees, a couple of months ago. It will only produce about 1,200 units by the end of the year at its plant in Normal, Illinois.

The company, which lost about $1bn in the first half of the year, estimates that annual production will hit 150,000 vehicles at its main factory by late 2023.

Based on the share count, Rivian is being valued at about $76.4bn on a fully diluted basis that accounts for stock options. That compares with a valuation of $27.6bn after a $2.65bn funding round in January, Bloomberg News previously reported.

Rivian had earlier marketed 135 million shares at between $72 and $74 after elevating that range from $57 to $62, according to filings with the US Securities and Exchange Commission.

Although it is a newcomer to the public market, California-based Rivian’s entry into the world of consumer EVs has been more than a decade in the making.

Founder and chief executive RJ Scaringe set up the first iteration of what would become Rivian in 2009 in his home state of Florida.

Over the years, it attracted a wide array of backers. As much as $5bn of the IPO shares are set to be bought by investors including Amazon, T Rowe Price, Coatue Management, Franklin Templeton, Capital Research Global Investors, D1 Capital, Third Point Investors, Blackstone, Dragoneer Investment Group and Soros Funds.

Rivian had a net loss of $994 million in the first six months of 2021, compared with a $377m deficit a year earlier, according to its filings.

The company expected to record a quarterly net loss of as much as $1.28bn due to costs associated with the start of production of the R1T pickup truck.

The company plans to allocate up to 7 per cent of its shares to eligible US customers who had orders as of September 30.

To attract retail investors, up to 0.4 per cent of the IPO shares will be allocated to SoFi Securities' online broker platform.

Mr Scaringe is expected to maintain outsize influence over Rivian through a class of stock giving him 10 votes per share, compared with one vote each for the shares sold in the IPO.

The offering is being led by Morgan Stanley, Goldman Sachs and JP Morgan Chase, with more than 20 banks listed on the cover page of its prospectus.

Rivian shares are expected to begin trading on Wednesday on the Nasdaq Global Select Market under the symbol RIVN.

Updated: November 10th 2021, 5:45 AM
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