(Reuters) – Electric vehicle startup Rivian said on Monday it closed a $1.3 billion investment round, led by fund manager T. Rowe Price but also including existing investors online retailer Amazon.com Inc (AMZN.O) and No. 2 U.S. automaker Ford Motor Co. (F.N)
FILE PHOTO: Rivian introduces all-electric R1S SUV at Los Angeles Auto Show in Los Angeles, California, U.S. November 27, 2018. REUTERS/Mike Blake/File Photo
The investment round, which also included BlackRock Inc(BLK.N), is the fourth this year for Rivian and positions the Plymouth, Michigan-based company as one of the better-financed players in a crowded EV manufacturing market where Tesla Inc (TSLA.O) is the most established player.
“This investment demonstrates confidence in our team, products, technology and strategy,” Rivian Chief Executive R.J. Scaringe said in a statement.
Electric vehicles still make up only a small piece of the global automotive market. While Tesla is the best-known maker, China and Europe are pushing automakers to roll out EVs, and Ford, General Motors Co (GM.N) and others have announced plans to spend billions of dollars developing the vehicles.
Founded in 2009, Rivian plans to build an all-electric pickup truck, the R1T, and the companion R1S SUV, starting in late 2020. Both models are based on a Rivian-designed “skateboard,” a chassis that bundles electric motor, batteries and controls and can accommodate a variety of body styles.
Prior to Monday’s announcement, Rivian had raised $2.2 billion from investors, according to investor website PitchBook, and was valued at an estimated $5 billion to $7 billion.
Rivian said on Monday no new board seats were added as a result of the latest investment.
T. Rowe Price has placed other bets in the auto sector. It is a large Tesla shareholder and also has invested in GM’s majority-owned Cruise self-driving division. T. Rowe Price also invested, along with Amazon, in self-driving car software startup Aurora and British online food delivery company Deliveroo.
Amazon, which has relationships and deals across the auto industry, led a $700 million investment round in Rivian in February. The e-commerce giant also ordered 100,000 electric delivery vehicles from Rivian. The first Amazon vans will be built at a former Mitsubishi plant in Normal, Illinois, starting in 2021.
Ford invested $500 million in Rivian in April and plans to help it begin production in Normal in 2020.
“We want to maintain a meaningful value in the ownership and future of that company,” Ford spokesman T.R. Reid said of Rivian.
In November, sources told Reuters a battery-powered Lincoln SUV, due in mid-2022, would be the first Ford vehicle to be built on the Rivian skateboard.
Cox Automotive Inc, owner of the Autotrader online automobile market and Kelley Blue Book car valuation service, invested $350 million in Rivian in September.
Reporting by Ben Klayman in Detroit; Editing by Sonya Hepinstall and Dan Grebler
More China coal investments overseas cancelled than commissioned since 2017
More China-invested overseas coal-fired power capacity was cancelled than commissioned since 2017, research showed on Wednesday, highlighting the obstacles facing the industry as countries work to reduce carbon emissions.
The Centre for Research on Energy and Clean Air (CREA) said that the amount of capacity shelved or cancelled since 2017 was 4.5 times higher than the amount that went into construction over the period.
Coal-fired power is one of the biggest sources of climate-warming carbon dioxide emissions, and the wave of cancellations also reflects rising concerns about the sector’s long-term economic competitiveness.
Since 2016, the top 10 banks involved in global coal financing were all Chinese, and around 12% of all coal plants operating outside of China can be linked to Chinese banks, utilities, equipment manufacturers and construction firms, CREA said.
But although 80 gigawatts of China-backed capacity is still in the pipeline, many of the projects could face further setbacks as public opposition rises and financing becomes more difficult, it added.
China is currently drawing up policies that it says will allow it to bring greenhouse gas emissions to a peak by 2030 and to become carbon-neutral by 2060.
But it was responsible for more than half the world’s coal-fired power generation last year, and it will not start to cut coal consumption until 2026, President Xi Jinping said in April.
Environmental groups have called on China to stop financing coal-fired power entirely and to use the funds to invest in cleaner forms of energy, and there are already signs that it is cutting back on coal investments both at home and abroad.
Following rule changes implemented by the central bank earlier this year, “clean coal” is no longer eligible for green financing.
Industrial and Commercial Bank of China, the world’s biggest bank by assets and a major source of global coal financing, is also drawing up a “road map” to pull out of the sector, its chief economist Zhou Yueqiu said at the end of May.
(Reporting by David Stanway; Editing by Kenneth Maxwell)
Bank of Montreal CEO sees growth in U.S. share of earnings
Bank of Montreal expects its earnings contribution from the U.S. to keep growing, even without any mergers and acquisitions, driven by a much smaller market share than at home and nearly C$1 trillion ($823.38 billion) of assets, Chief Executive Officer Darryl White said on Monday.
“We do think we have plenty of scale,” and the ability to compete with both banks of similar as well as smaller size, White said at a Morgan Stanley conference, adding that the bank’s U.S. market share is between 1% and 5% based on the business line, versus 10% to 35% in Canada. “And we do it off the scale of our global balance sheet of C$950 billion.”
($1 = 1.2145 Canadian dollars)
(Reporting by Nichola Saminather; Editing by Leslie Adler)
GameStop falls 27% on potential share sale
Shares of GameStop Corp lost more than a quarter of their value on Thursday and other so-called meme stocks also declined in a sell-off that hit a broad range of names favored by retail investors.
The video game retailer’s shares closed down 27.16% at $220.39, their biggest one-day percentage loss in 11 weeks. The drop came a day after GameStop said in a quarterly report that it may sell up to 5 million new shares, sparking concerns of potential dilution for existing shareholders.
“The threat of dilution from the five million-share sale is the dagger in the hearts of GameStop shareholders,” said Jake Dollarhide, chief executive officer of Longbow Asset Management. “The meme trade is not working today, so logic for at least one day has returned.”
Soaring rallies in the shares of GameStop and AMC Entertainment Holdings over the past month have helped reinvigorate the meme stock frenzy that began earlier this year and fueled big moves in a fresh crop of names popular with investors on forums such as Reddit’s WallStreetBets.
Many of those names traded lower on Thursday, with shares of Clover Health Investments Corp down 15.2%, burger chain Wendy’s falling 3.1% and prison operator Geo Group Inc, one of the more recently minted meme stocks, down nearly 20% after surging more than 38% on Wednesday. AMC shares were off more than 13%.
Worries that other companies could leverage recent stock price gains by announcing share sales may be rippling out to the broader meme stock universe, said Jack Ablin, chief investment officer at Cresset Capital.
AMC last week took advantage of a 400% surge in its share price since mid-May to announce a pair of stock offerings.
“It appears that other companies, like GameStop, are hoping to follow AMC’s lead by issuing shares and otherwise profit from the meme stocks run-up,” Ablin said. “Investors are taking a dim view of that strategy.”
Wedbush Securities on Thursday raised its price target on GameStop to $50, from $39. GameStop will likely sell all 5 million new shares but that amount only represents a “modest” dilution of 7%, Wedbush analysts wrote.
GameStop on Wednesday reported stronger-than-expected earnings, and named the former head of Amazon.com Inc’s Australian business as its chief executive officer.
GameStop’s shares rallied more than 1,600% in January when a surge of buying forced bearish investors to unwind their bets in a phenomenon known as a short squeeze.
The company on Wednesday said the U.S. Securities and Exchange Commission had requested documents and information related to an investigation into that trading.
In the past two weeks, the so-called “meme stocks” have received $1.27 billion of retail inflows, Vanda Research said on Wednesday, matching their January peak.
(Reporting by Aaron Saldanha and Sagarika Jaisinghani in Bengaluru and Sinead Carew in New York; Additional reporting by Ira Iosebashvili; Editing by Sriraj Kalluvila, Shounak Dasgupta, Jonathan Oatis and Nick Zieminski)
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