Irvine-headquartered EV maker Rivian said on Monday it plans to issue $1.25 billion in senior secured green notes due 2031 through a private offering, with proceeds to be used to redeem outstanding debt maturing in 2026.
In a SEC filing, the company said it expects to use the net proceeds, alongside existing cash, to redeem in full the $1.25 billion in outstanding floating-rate senior secured notes due 2026 and cover related fees and expenses.
On Friday, Bloomberg reported that Rivian was looking to raise up to $2 billion, in part to refinance its 2026 bonds.
Early pricing discussions indicated an interest rate of around 10%, though the terms could still change, the report said, citing sources familiar with the matter.
Rivian said the new notes will be backed by its subsidiaries that already guarantee the company’s existing revolving credit line.
They will be secured primarily by nearly all of the assets held by Rivian and these subsidiaries—except for assets that are already pledged as collateral under that credit line.
If Rivian receives funding from the previously announced U.S. Department of Energy loan, the notes will also be secured by the assets of Rivian New Horizon, LLC.
In January, the Biden administration finalized a $6.57 billion loan to Rivian New Horizon, LLC to support the development and construction of Project Horizon—Rivian’s second electric vehicle plant, which will be built in Georgia.
Last week, the new administration revoked a $2.92 billion partial loan guarantee previously awarded to residential solar panel installer Sunnova.
As of the time of writing, Rivian shares are trading 0.7% lower at $14.24 during Monday’s pre-market trading session., resulting in a market cap value of $16.72 billion
Rivian said earlier this month it secured a previously announced $1 billion investment from Volkswagen Group as part of their newly formed joint venture.
The funding is expected to be completed by the end of June.
Between January and March, the EV maker produced 14,611 vehicles at its manufacturing facility in Normal, Illinois, and delivered 8,640 vehicles.
