VW Group invest $1 billion into EV startup Rivian as part of a software development deal that could expand to as much as $5 billion.
The deal, which was announced Tuesday afternoon, sent Rivian’s shares up more than 36% in after-hours trading.
The two companies will create a joint venture focused on next-generation electrical architecture and software technology. Under the deal, VW Group will use Rivian’s existing electrical architecture and software platform. Initially, VW will invest $1 billion into Rivian via an unsecured convertible note that will convert into Rivian’s common stock subject to certain conditions upon the later of receipt of regulatory approvals and December 1, 2024.
VW Group is expected to invest a further $4B as part of the transaction, the companies said.
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