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World NewsRivian prices IPO at $78 a share, valuing company at $66.5 billion

Rivian prices IPO at $78 a share, valuing company at $66.5 billion

R.J. Scaringe, Rivian’s 35-year-old CEO, introduces his company’s R1T all-electric pickup and all-electric R1S SUV at Los Angeles Auto Show in Los Angeles, California, November 27, 2018.

Mike Blake | Reuters

Rivian Automotive, the electrical car maker backed by Amazon and Ford, priced its IPO on Tuesday at $78 a share, in line with a individual acquainted with the matter who requested to not be named as a result of the sale hasn’t been introduced but. The deal values Rivian at $66.5 billion.

Should underwriters train their full buy possibility, the company can have a market cap of over $68 billion. The inventory will commerce on the Nasdaq underneath ticker image RIVN.

Reuters and the Wall Street Journal reported on the IPO worth earlier. A Rivian spokesperson declined to remark.

Last week, Rivian elevated the anticipated worth vary to between $72 and $74 from a earlier vary of $57 to $62. At its $78 provide worth, Rivian is already value nearly as a lot as Ford ($79 billion) and General Motors ($85 billion). That’s all earlier than the company has even began producing actual income.

Rivian stated in its prospectus that it’ll lose as much as $1.28 billion within the third quarter, whereas income will vary from zero to $1 million. It’s the most recent EV company to draw hefty investor capital at a stratospheric worth with out but proving that it has a sustainable enterprise mannequin.

Lucid Motors is value $72.5 billion regardless that the company simply started manufacturing of its first automobiles. Nikola’s market cap was increased than Ford’s at one level final yr, regardless of the company having no income. It’s now value lower than $6 billion, after a short-selling agency accused the company of creating “an Ocean of Lies.”

Investors are constantly attempting to hop on the subsequent Tesla. Elon Musk’s company topped $1 trillion in market worth final month and is now the fifth most-valuable U.S. company.

While Rivian continues to be successfully pre-revenue, the company stated in its prospectus that it has a backlog of 55,400 pre-orders for its R1T and R1S electrical automobiles. The R1T is a truck that begins at $67,500, and the R1S is an SUV beginning at $70,000, in line with Rivian’s website.

The company stated it expects to fill these orders by the top of 2023. Additionally, Amazon has ordered 100,000 automobiles to be delivered by Rivian by 2030, and the businesses plan to have 10,000 new Rivian-Amazon supply automobiles on the highway as early as subsequent yr. Amazon is pushing its fleet to renewable vitality sources, and stated in 2019 that it was buying hundreds of automobiles from Rivian.

Amazon, which invested greater than $1.3 billion into Rivian, owned 22.4% of the company’s Class A shares previous to the IPO. That stake is value about $12.5 billion at the provide worth. Ford owned 14.4% of Class A inventory earlier than the providing, a stake now valued at $8 billion.

Rivian says its manufacturing facility in Illinois has the capability to supply as much as 150,000 automobiles per yr. The company had over 6,000 staff as of the top of June.

— CNBC’s Lora Kolodny and Annie Palmer contributed to this report

WATCH: Should you imagine the Rivian hype?

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