RJ Scaringe, founder and CEO of Rivian, and Executive Chairman of Ford, Bill Ford, announced Ford’s $500 million investment in Rivian.
Source: Ford Motor Co.
DETROIT – Ford Motor liquidated most of its ownership stake last year in the electric vehicle maker Rivian caraccording to the Detroit automaker’s annual report filed with the Securities and Exchange Commission on Friday.
Ford sold 91 million shares of the EV startup in 2022, according to profile. The sale of Ford shares was worth about $3 billion, the company said, a substantial gain from a $1.2 billion investment in Rivian.
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Ford, as of the end of last year, still owned about 11 million of Rivian’s original 101.9 million shares. The company declined to comment on plans for the remaining shares, which still makes the automaker one of the company’s largest shareholders, according to FactSet. Rivian also declined to comment.
Ford first invested in Rivian in 2019, before the electric-car maker went public. At the time, the two companies said Ford would build an electric vehicle based on the “skateboard” platform that currently underpins Rivian’s R1T pickup truck and R1S SUV. Despite former Ford CEO Jim Hackett’s enthusiasm for the deal, those plans never came to fruition.
But as a result of that initial investment, Ford was one of the largest shareholders in the company when Rivian’s Blockbuster IPO in 2021with 12% shares.
Ford said it sold 25.2 million shares of Rivian in the second quarter, for a total of about $700 million. It sold an additional 51.9 million shares in the third quarter for about $1.8 billion, according to previous filings.
Hackett’s successor, Jim Farley, has made it clear that Ford will likely sell its stake, but it’s unclear when the automaker plans to sell shares and pull out of Rivian.
Ford’s unrealized profit/loss is a profit of $8.3 billion in 2021 and a loss of $968 million in 2022, i.e. damage automaker profits last year.
Shortly after Rivian’s successful IPO in November 2021, the company’s stock hit an all-time high of nearly $180 a share during a time when Wall Street was enamored with electric-powered startups. , which leads to valuations of companies early or before sales are inflated.
Rivian stock is currently trading around $20 a share, after some goals are missed and slower than expected growth car production at a factory in Normal, Illinois. The company is valued at around $18 billion.
