US electric vehicle maker Rivian Automotive has received funding through a committed $1bn, ten-year term loan facility from Germany’s Volkswagen Group.
A Securities and Exchange Commission filing said the facility was completed in connection with the companies’ joint venture (JV).
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It was arranged through two mirror agreements signed in November 2024, when Rivian and Volkswagen Group Technologies – formerly Rivian and VW Group Technology – was formed.
Volkswagen and Rivian created this $5.8bn JV to develop technologies for future models, including subcompact cars expected to launch in 2027.
Under the Loan A Agreement, Volkswagen Specter provided a $1bn loan to the JV.
The loan is secured by all JV assets and carries a fixed annual interest rate of 5.93%.
Volkswagen Specter is a special-purpose subsidiary formed by the Volkswagen Group to manage the financial architecture of its massive multi-billion-dollar JV with Rivian.
The JV then provided the $1bn proceeds to Rivian JV SPC, a wholly owned special-purpose subsidiary of Rivian Automotive, under the Loan B Agreement.
This loan has a fixed annual interest rate of 6.03% and is secured only by Rivian SPV’s 50% equity stake in the JV.
Rivian SPV distributed the Loan B proceeds to Rivian Automotive for general corporate purposes.
Both loans mature on 7 October 2036.
Principal repayments will begin on the third anniversary of the funding date, with $100m due annually in two semi-annual payments of $50m.
The remaining balance will be paid at final maturity.
Interest payments will be made twice a year, starting on the second anniversary of the funding date.
Loan B permits voluntary prepayments without a penalty or premium, subject to prior written notice. A corresponding mandatory prepayment is then required under Loan A.
The facility is non-recourse to Rivian Automotive and has no corporate guarantee from Rivian or third parties. Default recourse is limited to pledged collateral.
The transaction completes the committed debt financing outlined in the JV agreements disclosed in November 2024.
