Rivian said it plans to sell 75 million shares, raising about US$1.5 billion based on its July 6 closing price. The announcement sent the electric vehicle maker’s shares down 9% in extended trading.

The company said the proceeds would fund equity contributions tied to its loan agreement with the US Department of Energy.

In April, Rivian said it would obtain a smaller but quicker US$4.5 billion government loan to build and equip its Georgia plant, which is expected to support expanded production of its lower-priced R2 sport utility vehicle.

Rivian also projected second-quarter revenue of US$1.55 billion to US$1.65 billion, above analysts’ average estimate of US$1.45 billion.

The share sale will dilute existing investors.

It follows stronger second-quarter deliveries, a higher full-year delivery forecast, and Rivian’s estimate that cash and cash equivalents rose to US$5.3 billion at the end of June from US$4.8 billion at the end of the first quarter.

🔗 Source: Reuters