Toronto, Ontario — This week, Magna gets booted from its proposed deal with automotive technology group Veoneer, Rivian officially files its initial public offering (IPO) and Axalta reevaluates its full-year guidance.
Melancholy at Magna
Swedish automotive technology firm Veoneer has opted to go with Qualcomm’s $37-per-share merger bid following a previously announced merger with Aurora, Ontario-based Magna International.
Magna said Monday that Veoneer’s board determined the previously announced proposal by Qualcomm is a superious proposal under the terms of thep previously announced merger agreement between Magna and Veoneer.
Magna had originally offered $32-per-share—$5-per-share less than Qualcomm’s offer.
In mid-September, Veoneer issued a statement dictating that there were “no assurances” that the company’s discussions with Qualcomm would result in a transaction.
Magna has waived the four-day matching period to make a counterproposal and Veoneer has terminated its Merger agreement with the Aurora, Ont.-based company.
Veoneer will now pay Magna a termination fee of $110 million.
Rivian takes a risk
Electric vehicle startup Rivian has officially filed to become a publicly traded company in the United States, though it also revealed its dire need for cash in the document.
In filings to the U.S. Securities and Exchange Commission, Rivian said it has lost US$2 billion since the start of last year, citing the costs and risks of developing its electric vehicles.
Rivian also expects to spend US$8 billion on facilities and equipment through 2023.
In the filing, Rivian also outlined its long-term business strategies, its plan to first sell its EVs in the United States and Canada and then expand to Western Europe. Sales in Asia will follow. Rivian said it will build local facilities to support growth into those new markets, but did not specify further details.
Founded in 2009, Rivian is one of many newfound electric startups raring to square up against Tesla. The brand current touts two vehicles: the R1T electric pickup, the first of which will be delivered before the end of 2021, and the electric SUV R1S.
Amazon has invested US$1.8 billion in Rivian thus far, as per its contract to purchase 100,000 delivery vehicles from the electric automaker.
On Sept. 20, Axalta Coating Systems Ltd. pulled its full-year guidance and financial projections for the year, citing supply chain shortages and raw material constraints in addition to financial setbacks in the fourt quarter.
The global coatings company said it expects its Q3 sales to decline by US$40 million relative to volume levels it had previously projected. Its earlier Q3 guidance called for US$138 million in adjusted EBIT.
Industry forecasts for light vehicle production now call for these disruptions to continue into 2022, the company said, adding that Axalta now expects global production impacts to total about 11 million units for 2021, up from its previous view of 7 million units.
Axalta noted that underlying demand remains strong for its Performance Coatings segment. This segment sells paint and coatings to auto-refinish shops and to industrial customers.
Axalta is the third major US paints and coatings producer to issue a profit warning.