Irvine-Based Rivian Expects $60B+ Valuation for IPO

Tuesday, November 09, 2021

Main News Photo

(Orange County Business Journal)

Amazon stands to come out on top, alongside Rivian Automotive Inc. founder and CEO RJ Scaringe, as the Irvine electric vehicle maker seeks a valuation of as much as $65 billion in its forthcoming IPO.

Rivian disclosed in a regulatory filing late last week an expected per share price range of $72 to $74 in its highly anticipated initial public offering, expected as soon as this week.

The IPO would give Rivian a $63.7 billion valuation at the midpoint of the range, and $64.6 billion valuation at the high point, assuming underwriters exercise their stock options.

Factoring in employee stock options and restricted stock units, and the company’s valuation would inch closer to $70 billion.

The company said it expects net proceeds from the stock listing of as much as $11.5 billion at the current pricing expectations.

The raise would give Rivian the title of fourth-largest IPO in the U.S. in the past decade, and the company’s valuation would make it OC’s second-largest public company after $73 billion-valued Irvine heart valve maker Edwards Lifesciences Corp. (NYSE: EW).

Stakeholders

Amazon, which has an order for 100,000 electric delivery vans from Rivian, will have a 17.3% stake in the business after the company goes public, giving it the largest chunk of the electric vehicle maker (see graphic, page 49).

Scaringe, whose wealth the Business Journal estimated to be about $5 billion earlier this year, is set to come out of the IPO with a 9.5% stake in the business.

Others with large stakes in Rivian, which is backed with some $10.5 billion in funding to date, include funds advised by T. Rowe Price Associates (14.5%), Global Oryx Company Ltd. (12.2%), Ford Motor Co. (11.2%) and Manheim Investments Inc. (4.3%).

Vehicle Rollout

Rivian’s IPO is good timing as the broader automotive industry focuses on the electrification of their fleets. A number of EV startups have also set their sights on a piece of the electric vehicle market, including Lucid Group Inc. (Nasdaq: LCID) and Fisker Inc. (NYSE: FSR).

Locally, there’s also Irvine-based luxury automaker Karma Automotive LLC, which is said to be exploring going public.

Rivian’s production and deliveries, after being delayed due to the global supply chain crunch, began ramping in September, when it said it produced 12 of its inaugrual R1T trucks and delivered 11.

The five-passenger truck is Rivian’s first consumer vehicle, set to be followed by the R1S SUV next month.

By the end of October, Rivian said it pumped production of the R1T to 180, with deliveries totaling 156. The company said it expects to have produced 1,200 R1T trucks with about 1,000 of those delivered by the end of this year. Some 25 of the SUVs are estimated to be made and 15 of those delivered at the end of 2021.

The vehicle maker’s business is not just focused on passenger vehicles.

On the commercial side, with the halo business being Amazon’s delivery van order, Rivian is also in the early stages of production. It said it has made and produced 10 electric delivery vehicles to date. A handful of prototype Amazon vehicles have been seen in use across Irvine in recent weeks.

The Amazon order is expected to be fulfilled by 2025.

Category: Economic News, Destination Irvine, Automotive News