Ford "PRICE WAR" drives RIVN under $10

[evguy]

What I said was that it makes no sense that RIVN has not raised capital, and that the only reasonable explanation for why they haven't raised capital, coincident with delaying the Georgia plant (which is the only path to profitability), is that it is now negotiating a takeover. Does anyone disagree? If they were planning to raise capital (which they need to do if it is not doing a takeover), would you have prefered they raise more capital at $50 per share or $8 per share, where it trades at today?

Regarding a takeover, I said that an optimal takeover for a buyer would be a prepack bankruptcy. Would anyone disagree? That's almost always the best way to takeover in this kind of situation.

There's another (and I think better) explanation for why Rivian is not raising capital right now: They're in a position to execute this year's cost reductions plans, and achieve gross profit, while still having billions on hand at the end of that effort. The reason they're in that position is that they already raised $2.8B last year, before the demand softening freakout (mild stroke of genius in hindsight), bringing total cash and equivalents to $9B. Rivian thinks they'll be in a better position to raise more capital on better terms in 2025, after they have executed several more steps on their path to profitability.

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[Nix]

...the only reasonable explanation for why they haven't raised capital
...is that it is now negotiating a takeover.

...an optimal takeover for a buyer would be a prepack bankruptcy

And again, the answer is a resounding NO. Because Rivian is not bankrupt, and does not qualify for bankruptcy relief under bankruptcy laws. It cannot be done. It is an impossibility, no matter how optimal someone might want it to be.

There isn't any judge in the world who would approve bankruptcy for a company with $9B in cash and less than $3B in short term debt.

$17B in total assets, and less than $8B in total liabilities.

Rivian simply currently isn't eligible under bankruptcy laws to file for any relief from creditors. Rivian goes into court and says they can't pay their creditors, and the judge just takes some of their cash and pays off all their short term debt and says "fixed it for you". Done.


What part of this is not absolutely clear?

 

[sphereobject]

And again, the answer is a resounding NO. Because Rivian is not bankrupt, and does not qualify for bankruptcy relief under bankruptcy laws. It cannot be done. It is an impossibility, no matter how optimal someone might want it to be.

There isn't any judge in the world who would approve bankruptcy for a company with $9B in cash and less than $3B in short term debt.

$17B in total assets, and less than $8B in total liabilities.

Rivian simply currently isn't eligible under bankruptcy laws to file for any relief from creditors. Rivian goes into court and says they can't pay their creditors, and the judge just takes some of their cash and pays off all their short term debt and says "fixed it for you". Done.


What part of this is not absolutely clear?

Yes, of course. I was just saying an optimal takeover for a buyer would be a prepack in or around Q4 2025, when Rivian runs out of money as RJ explained, which will likely occur unless they raise capital before then or sell before then.

 

[COCORIVIAN]

Rivian shares also are a popular target with short sellers, with the equivalent of nearly 19% of its stock now being shorted and setting up the potential of a short squeeze should there be a positive data point emerges, the report said.


http://www.mtnewswires.com Copyright © 2024 MT Newswires

By: MIdnight_Trader

 

[evguy]

Rivian shares also are a popular target with short sellers, with the equivalent of nearly 19% of its stock now being shorted and setting up the potential of a short squeeze should there be a positive data point emerges, the report said.


http://www.mtnewswires.com Copyright © 2024 MT Newswires

By: MIdnight_Trader

That's one reason I've been buying a little more this week. Still a big risk and volatility will continue, at least until they are churning out R2.

 

[Nix]

...[Rivian] is now negotiating a takeover

...around Q4 2025...

I'm dealing with a goldfish who can't even remember what they said.

 

[sphereobject]

There's another (and I think better) explanation for why Rivian is not raising capital right now: They're in a position to execute this year's cost reductions plans, and achieve gross profit, while still having billions on hand at the end of that effort. The reason they're in that position is that they already raised $2.8B last year, before the demand softening freakout (mild stroke of genius in hindsight), bringing total cash and equivalents to $9B. Rivian thinks they'll be in a better position to raise more capital on better terms in 2025, after they have executed several more steps on their path to profitability.

I hope you are right!

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