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

R.J. Scaringe, Rivian’s 35-year-old CEO, introduces his firm’s R1T all-electric pickup and all-electric R1S SUV at Los Angeles Auto Present 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 an individual aware of 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.

Ought to underwriters train their full buy choice, the corporate could have a market cap of over $68 billion. The inventory will commerce on the Nasdaq below ticker image RIVN.

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

Final week, Rivian elevated the anticipated worth vary to between $72 and $74 from a earlier vary of $57 to $62. At its $78 supply worth, Rivian is already price virtually as a lot as Ford ($79 billion) and General Motors ($85 billion). That is all earlier than the corporate has even began producing actual income.

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

Lucid Motors is price $72.5 billion though the corporate just began production of its first vehicles. Nikola’s market cap was higher than Ford’s at one level final 12 months, regardless of the corporate having no income. It is now price lower than $6 billion, after a short-selling agency accused the corporate of creating “an Ocean of Lies.”

Buyers are constantly making an attempt to hop on the subsequent Tesla. Elon Musk’s firm topped $1 trillion in market worth final month and is now the fifth most-valuable U.S. firm.

Whereas Rivian remains to be successfully pre-revenue, the corporate 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 corporate stated it expects to fill these orders by the top of 2023. Moreover, 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 street as early as subsequent 12 months. Amazon is pushing its fleet to renewable power sources, and stated in 2019 that it was purchasing thousands of vehicles from Rivian.

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

Rivian says its manufacturing unit in Illinois has the capability to provide as much as 150,000 automobiles per 12 months. The corporate had over 6,000 workers as of the top of June.

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

WATCH: Should you believe the Rivian hype?

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