Rivian valued at over $100 billion in debut, after world’s biggest IPO of 2021

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(Businesshala) – Shares of Rivian Automotive Inc. rose 53% on its Nasdaq opening on Wednesday, giving the Amazon-backed electric vehicle maker a market valuation of more than $100 billion this year following the world’s biggest initial public offering.

The company logo is seen on the Amazon-backed electric vehicle (EV) maker, the Rivian R1T pickup, as it is parked outside the Nasdaq Market site during the company’s IPO in Times Square on November 10, 2021 in New York City, US Is. Businesshala/Brendan McDermid

This made Rivian the second most valuable US automaker behind Tesla Inc, which is worth $1.05 trillion. Rivian is ahead of General Motors Company with $86 billion, Ford Motor Company with $77 billion and Lucid Group with $66 billion.

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The stock opened at $106.75 per share, surpassing the offer price of $78, and hit a high of $119.46. It was still trading above $98.00 in the mid-afternoon.

“The market doesn’t care about valuations or anything,” said Jake Wujoustic, chief market analyst at TrendSpider, on Wednesday of trading at Rivian and Tesla. “It’s trading the money flowing into the market. It’s a pretty strong seasonal time to risk assets.”

Over the past year, EV companies have emerged as some of the hottest investments. Including securities such as options and restricted stock units, Rivian’s fully diluted valuation exceeded $108 billion.

The IPO allows Rivian to raise approximately $12 billion for its growth, and this figure could rise to $13.7 billion if the full allocation of shares is exercised.

“The transition to a public company (and) the increase in our capital base” enables Rivian to “develop promising products and volumes and growth in terms of new segments and new vehicles,” Rivian chief executive RJ Scaringe said in an interview. said in.

Wall Street’s biggest institutional investors, including T. Roe Price and BlackRock are betting on Rivian to be the next big player in a field dominated by Tesla Inc, amid mounting pressure on automakers to eliminate vehicle emissions in China and Europe.

Amazon.com Inc. is the largest shareholder of Rivian with a 20% stake.

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Rivian’s IPO comes against the backdrop of a United Nations climate summit, where automakers, airlines and governments unveiled several pledges to cut greenhouse gas emissions from global transportation.

GM CEO Mary Barra said Wednesday that Rivian’s IPO only showed how undervalued her company is.

“It’s a huge opportunity for me,” she told a New York Times event. “General Motors is so underrated.”

Rivian is investing heavily to ramp up production, doubling down on its upscale all-electric R1T pickup truck launched in September. It plans to hit some of the hottest segments in the market with an SUV and delivery vans.

Scaring said the Irvine, California-based company plans to make at least one million vehicles a year by the end of the decade. It has a plant in Illinois, and has announced plans to open a second US factory and eventually set up production in China and Europe.

Founded as Mainstream Motors by Scaring in 2009, the company was renamed as Rivian in 2011, a name derived from “Indian River” in Florida, a place Scaring saw as a youth in a rowboat. Comes frequently.

After the scarring IPO, Rivian will hold all outstanding Class B common shares and receive 10 votes per share, Rivian said in a filing.

Ford-backed Rivian priced an IPO of 153 million shares at $78 per share, raising nearly $12 billion, making it one of the largest US initial public offerings ever.

According to the filing, Amazon, T. Roe Price, Franklin Templeton, Capital Research and Blackstone are among a group of “cornerstone investors” indicated to buy shares worth up to $5 billion.

Shares of Rivian were also offered to retail investors on Social Finance Inc (SoFi).

Morgan Stanley, Goldman Sachs and JP Morgan were the principal underwriters of the offering.

Reporting by Noor Zainab Hussain in Bangalore and Ben Kellman in Detroit; Additional reporting by Paul Lienert in Detroit, Niket Nishant and Sanjana Sitara Shivdas in Bengaluru and Hyunju Jin in San Francisco; Editing by Arun Koyur, Anil D’Silva and Richard Chang

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