Rivian plunges 22% as Ford and other investors to sell millions of shares as lock-up period expires

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Rivian plunges 22% as Ford and other investors to sell millions of shares as lock-up period expires
Rivian.Michael M. Santiago/Getty Images
  • Rivian stock plunged 22% on Monday after CNBC reported that Ford is selling millions of shares.
  • The expiration of Rivian's lock-up period means insiders can now sell shares in the company following its November IPO.
  • Rivian is down more than 80% from its peak, when the EV truck company was valued at $153 billion.
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Rivian stock plunged 22% on Monday as its early investors take advantage of the expiration of its lock-up period and sell millions of shares.

CNBC reported over the weekend that Ford is selling 8 million of its Rivian shares through a block trade with Goldman Sachs. Ford owned about 12% of the electric truck manufacturer, or about 102 million shares, prior to the sale.

Meanwhile, JPMorgan is selling a block of 13 million to 15 million Rivian shares for an unknown seller, CNBC reported. Both share blocks are priced at $26.90, which represents a 6.7% discount to Friday's close. Rivian stock fell 19% to $23.32 in Monday trades.

The unknown seller could be Amazon, which owns about 18% of Rivian, or about 158 million shares, and was an early investor in the company. Both Ford and Amazon revealed billion-dollar losses related to their Rivian stakes in their most recent earnings calls.

Rivian went public in November and saw its valuation peak at $153 billion. The company was briefly worth more than Ford despite it having delivered just a couple thousand vehicles since its inception.

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But supply chain disruptions have led Rivian to delay some of its deliveries and raise prices on its flagship car by more than $10,000. That, combined with rising interest rates, have led investors to focus more on valuations and less on growth at any price. Rivian's valuation has fallen to just $23 billion today.

Lock-up periods often last about six months after a company goes public. The period prevents company insiders and early investors from selling their shares.

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