Ed Ludlow and Matt Day
Fri, October 29, 2021
(Bloomberg) -- Amazon.com Inc. owns a 20% stake in electric-vehicle maker Rivian Automotive Inc., the startup with which it has placed an order for 100,000 battery-powered delivery vans, the e-commerce giant disclosed Friday in a securities filing.
As of Sept. 30, Amazon held equity investments “including preferred stock of Rivian Automotive, Inc. representing an approximately 20% ownership interest,” which will be valued on the balance sheet at $3.8 billion -- up from $2.7 billion at the end of 2020, Amazon said in the filing.
Amazon shares pared losses of more than 5% after the disclosure of its investment in Rivian to trade down 2.8% to $3,347.27 as of at 12:41 p.m. in New York. The stock has gained just 2.8% in 2021, trailing the S&P 500 Index significantly.
Rivian is seen as a genuine contender in the EV market and potential rival to incumbent Tesla Inc. The startup’s raised more than $10.5 billion from investors to date and is seeking a valuation of $80 billion in an IPO later this year, Bloomberg reported in August.
Rivian said in a filing last week that it could post a quarterly loss of as much as $1.28 billion as it ramps up production on its debut EV, a battery-electric pickup called R1T. The Irvine, California-based company had disclosed in a separate filing earlier this year that Amazon had invested more than $1.3 billion in the automaker and held almost 150 million shares of preferred stock.
Amazon’s voting power as a percentage was redacted. A representative for Rivian declined to comment.
Ties That Bind
Peter Krawiec, a senior vice president of worldwide corporate and business development at Amazon, is on Rivian’s board. The Seattle-based company’s order for electric delivery vans extends through the end of the decade, with the first 10,000 units due before the end of next year. The order is a cornerstone of Amazon’s ambitious plan to curb its rising greenhouse gas emissions.
Limited production of Rivian’s debut pickup started in August and customer deliveries began last month. The startup has encountered numerous delays it has blamed on Covid-induced supply-chain challenges. Rivian has pushed back production of its second consumer model, a sports-utility vehicle called the R1S.
It’s also prioritizing manpower and resources for production of Amazon’s van over its retail consumer-focused models, Bloomberg reported last month.
All three vehicles -- the truck, van and SUV -- will be built at Rivian’s plant in Normal, Illinois. The company is in talks to invest $5 billion for a second factory in Fort Worth, Texas, Bloomberg reported in August. It’s also assessing options for a plant in Europe that could also build Amazon vans, Bloomberg reported in January.
Other investors in the EV maker include Ford Motor Co., which has invested more than $820 million in Rivian and holds a stake greater than 5%. Ford recenly vacated its Rivian board seat.
For Amazon, the bet on Rivian represents one of its biggest investments, in dollar terms, in another company. The e-retailer’s corporate development group has put cash into startups working on voice technology related to the Alexa digital assistant. Other investments feature companies that are its suppliers or partners. The roster includes investments -- or warrants to buy stock in -- food distributor SpartanNash Co. and air cargo operator Air Transport Services Group Inc.
Chinese electric vehicle maker BYD, backed by Warren Buffett, to raise up to US$1.8 billion in Hong Kong share sale
Chad Bray chadwick.bray@scmp.com
Fri, October 29, 2021
BYD, the Chinese battery and electric carmaker backed by Warren Buffett, is seeking to raise up to US$1.8 billion in a follow-up stock flotation in Hong Kong.
The Shenzhen-based electric vehicle maker aims to sell 50 million new shares in a price range of HK$273.5 (US$35.17) to HK$279.5 each, according to a term sheet seen by the South China Morning Post. That would represent a discount of 5.8 per cent to 7.8 per cent to the HK$296.60 closing price of its H-shares in Hong Kong on Friday.
The new shares would begin trading on November 1 and represent about 1.8 per cent of BYD's market cap.
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BYD plans to use the proceeds from the sale to supplement its working capital, to repay debt, to invest in research and development and for general corporate purposes.
The share sale comes a day after BYD reported that its net profit dropped 27.5 per cent to 1.27 billion yuan (US$199 million) in the third quarter. BYD's shares fell 1.7 per cent on Friday following is earnings announcement the night before.
In August, a mainland brokerage backed by Citic Securities said industry leader BYD should be valued at no less than 1.5 trillion yuan by 2022, or 169 times its projected earnings. The company's market cap was 821.9 billion yuan as of Friday's close, according to Bloomberg data.
On Monday, BYD, which is controlled by its billionaire co-founder Wang Chuanfu, said it had received approval from the Hong Kong stock exchange for the proposed spin off of its semiconductor unit in mainland China.
The company still needs to meet a number of conditions before the spin-off can be implemented, including receiving approval from the Shenzhen Stock Exchange and the China Securities Regulatory Commission (CSRC), according to a stock exchange filing.
BYD's chairman and co-founder Wang Chuanfu speaks at the Auto Shanghai 2019 show in Shanghai. Photo: AP alt=BYD's chairman and co-founder Wang Chuanfu speaks at the Auto Shanghai 2019 show in Shanghai. Photo: AP
The carmaker first announced in May a plan to list BYD Semiconductor, its 72.3 per cent-owned chip-making unit, on ChiNext, a Nasdaq-like technology board operated by the Shenzhen bourse, with the aim of raising 2.69 billion yuan.
However the proposed spin-off in an initial public offering in Shenzhen was put on hold in August after the bourse launched an investigation into the law firm advising on the deal. The exchange suspended more than a dozen other IPO applications at the same time involving the same law firm.
BYD revived its application to list the semiconductor unit last month after filing additional paperwork with Chinese regulators.
Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.
Chad Bray chadwick.bray@scmp.com
Fri, October 29, 2021
BYD, the Chinese battery and electric carmaker backed by Warren Buffett, is seeking to raise up to US$1.8 billion in a follow-up stock flotation in Hong Kong.
The Shenzhen-based electric vehicle maker aims to sell 50 million new shares in a price range of HK$273.5 (US$35.17) to HK$279.5 each, according to a term sheet seen by the South China Morning Post. That would represent a discount of 5.8 per cent to 7.8 per cent to the HK$296.60 closing price of its H-shares in Hong Kong on Friday.
The new shares would begin trading on November 1 and represent about 1.8 per cent of BYD's market cap.
Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.
BYD plans to use the proceeds from the sale to supplement its working capital, to repay debt, to invest in research and development and for general corporate purposes.
The share sale comes a day after BYD reported that its net profit dropped 27.5 per cent to 1.27 billion yuan (US$199 million) in the third quarter. BYD's shares fell 1.7 per cent on Friday following is earnings announcement the night before.
In August, a mainland brokerage backed by Citic Securities said industry leader BYD should be valued at no less than 1.5 trillion yuan by 2022, or 169 times its projected earnings. The company's market cap was 821.9 billion yuan as of Friday's close, according to Bloomberg data.
On Monday, BYD, which is controlled by its billionaire co-founder Wang Chuanfu, said it had received approval from the Hong Kong stock exchange for the proposed spin off of its semiconductor unit in mainland China.
The company still needs to meet a number of conditions before the spin-off can be implemented, including receiving approval from the Shenzhen Stock Exchange and the China Securities Regulatory Commission (CSRC), according to a stock exchange filing.
BYD's chairman and co-founder Wang Chuanfu speaks at the Auto Shanghai 2019 show in Shanghai. Photo: AP alt=BYD's chairman and co-founder Wang Chuanfu speaks at the Auto Shanghai 2019 show in Shanghai. Photo: AP
The carmaker first announced in May a plan to list BYD Semiconductor, its 72.3 per cent-owned chip-making unit, on ChiNext, a Nasdaq-like technology board operated by the Shenzhen bourse, with the aim of raising 2.69 billion yuan.
However the proposed spin-off in an initial public offering in Shenzhen was put on hold in August after the bourse launched an investigation into the law firm advising on the deal. The exchange suspended more than a dozen other IPO applications at the same time involving the same law firm.
BYD revived its application to list the semiconductor unit last month after filing additional paperwork with Chinese regulators.
Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.
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