Rivian Automotive, which is backed by Amazon.com Inc, considerably increased the estimated offer price of its shares on Friday, aiming for a valuation of up to $65 billion in its initial public offering.
It had targeted a valuation of more than $53 billion at a price of $62 per share early this week. On Nov. 9, the business aims to sell 135 million shares in the $72-$74 range to raise almost $10 billion.
Rivian’s price band has been raised following a successful investor roadshow this week, with Wall Street’s largest IPO investors betting on the company to be the next big thing in a field dominated by Tesla.
Rivian’s IPO could make it one of just three companies to raise more than $8 billion in the last decade, following Alibaba and Facebook.
Despite the fact that Rivian has yet to sell a large number of electric vans or trucks, its $65 billion valuation puts it ahead of Fiat maker Stellantis NV and closer to traditional automakers Ford and General Motors.
Rivian has been investing aggressively to ramp up manufacturing, especially for its luxury all-electric R1T pickup truck, which debuted in September, defeating established competitors such as Tesla Inc, General Motors, and Ford.
As of Oct. 31, the company had around 55,400 R1T and R1S preorders in the United States and Canada.
Rivian announced that deliveries of the R1T had begun and that revenue had been achieved for the three months ended September 30. However, due to rising production costs, the net loss for that period is expected to rise.
The electric vehicle market is increasing as buyers become more environmentally conscious, and many manufacturers consider it as a symbol of luxury. In the most recent quarter, Tesla manufactured a record number of automobiles, indicating high demand for electric vehicles.
Amazon has placed an order for 100,000 Rivian electric delivery vehicles as part of a larger drive to reduce its carbon footprint.
Rivian, on the other hand, will be up against automakers in both the consumer and commercial van segments.
Ford claimed its F-150 Lightning electric pickup truck has received more than 160,000 orders, and an electric version of its Transit commercial van is “totally sold out.”
Electric delivery vans, SUVs, and pickup trucks are on the way from General Motors.
The principal underwriters are Morgan Stanley, Goldman Sachs, and J.P. Morgan. Rivian will trade under the symbol “RIVN” on the Nasdaq. Underwriters could exercise the “greenshoe” option on shares, therefore the valuation includes these.
