Toronto, Ontario — In this week’s Tuesday Ticker, Canada joins Mexico in its request for a formal United-States-Mexico-Canada-agreement (USMCA) consultation, Rivian files a confidential public offering and Driven Brands prepares for its secondary public offering.
Parts parlance
Canada has joined Mexico in seeking a formal consultation with the United States over USMCA content rules for automobiles, both Mexico and Canada announced Friday.
On August 20, Mexico requested the formal consultation over the interpretation and application of tougher content rules for cars under the USMCA (United States-Mexico-Canada agreement), after initially voicing disagreement in May over the issue, when the nation cited differences with the United States’ methods.
Canada and Mexico use more flexible interpretations to the rule.
“We know how important the auto industry is to Canada’s workers and the Canadian economy. Canada has advised the U.S. and Mexico that it intends to join the consultations as a third party,” said Patricia Skinner, spokeswoman for Global Affairs Canada.
The USMCA, the successor to the North American Free Trade Agreement, requires 75 percent North American content for a vehicle to be considered as being from North America.
The same percentage will apply for essential parts from July 1, 2023, up from 69 percent now, and compared with 62.5 percent under the previous trade pact.
Mexico argues that once the level of essential parts hits 75 percent, it is considered 100 percent and should be counted as such toward the overall value of the automobile.
Revved up at Rivian
Electric car company Rivian has confidentially filed an initial public offering (IPO) seeking roughly $80 billion valuation, according to a report from Bloomberg.
The Irvine, California-based startup said in a statement Friday that it submitted its S-1 registration to the Securities and Exchange Commission, confirming an earlier report by Bloomberg News.
The company would like to launch an IPO around the Nov. 25 American Thanksgiving holiday, said Bloomberg’s sources, who asked not to be identified because the filing was confidential. The timing will depend on approval from the SEC.
Driving ahead
Driven Brands announced its secondary public offering on Aug. 5, offering 12 million shares for $29.50 each, said the company.
Underwriters will have a 30-day option to purchase up to an additional 1.8 million shares of common stock, but Driven Brands is not selling any shares of common stock in the offering and will not receive any proceeds from the offering.
The company’s record-setting initial public offering announced on January 14 raised $700 million, selling almost 32 million shares for $22 each.
Driven Brands reported second-quarter earnings this year of $35.2 million. This exceeded expectations and the company’s earnings from last year’s second quarter, which was less than $3.1 million.
