Ford’s stake in EV truck start-up Rivian is worth more than $10 billion in first day of trading

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  • According to a public filing by Rivian, Ford owns about 12% of the company through convertible notes as well as investments that began in 2019.
  • Based on Rivian’s closing price of $100.73 per share Wednesday after its Nasdaq debut, Ford’s roughly 102 million shares of the company are worth about $10.3 billion.
  • According to public documents, Ford bought the shares for a total of $820 million.

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A major winner is ironically one of its competitors, Ford Motor, after electric vehicle start-up Rivian Automotive’s blowout IPO on Wednesday.

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According to a public filing by Rivian, Ford owns about 12% of the company through equity and bond investments that began in 2019. Based on Rivian’s closing price of $100.73 per share Wednesday after its Nasdaq debut, Ford’s roughly 102 million shares of the company, including notes that were converted into shares in June, are worth about $10.3 billion alone. According to public documents, it bought its equity stake for a total of $820 million.

When Ford invested $500 million in Rivian in 2019, the companies’ plan to jointly develop a vehicle for the Detroit automaker’s Lincoln luxury brand was later abandoned. Ford also got a seat on the company’s board, which it has since relinquished.

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The actions have led some to question whether Ford, which is undergoing a multi-billion restructuring, will be a long-term investor in Rivian. Ford continues to call Rivian a “strategic investment,” which it reaffirmed Wednesday.

“We have stated that Rivian is a strategic investment and we are exploring potential collaborations,” Ford spokesman TR Reid said in an email to CNBC. “We won’t speculate about what Ford will or won’t do in the future.”

Ford CEO Jim Farley, who inherited an investment in Rivian from his predecessor, Jim Hackett, took to Twitter on Wednesday to congratulate Rivian and its CEO and founder, RJ Scaring.

Rivian, in its registration statement with the SEC, acknowledged Ford’s investment as potentially leading to a conflict of interest, but benefits in other ways.

The company cited both Ford and Amazon as saying, “Accordingly, such stockholders may have different business interests than us or our other stockholders, and may act or vote their shares as such.” which could adversely affect us or our other stockholders.” Rivian owns about 20%.

Ford bought $415 million in convertible notes in July, which became common stock in June 2022. The conversion price shall be equal to $71.03 per share less or the IPO price per share multiplied by the applicable discount rate determined with reference to the time of conversion. , according to the documents.

According to public documents, a wholly owned subsidiary of Ford, called Troy Design & Manufacturing, also has a contract to supply parts for Rivian’s R1 vehicle program.

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