Linklaters Advises Volkswagen on Vehicle Software Technology Joint Venture and Investment Transactions with Rivian

Linklaters is advising Volkswagen AG ("Volkswagen") on a proposed 50-50 joint venture with Rivian Automotive, Inc. ("Rivian") to create next-generation electrical architecture and best-in-class software technology, intended to be used in both companies' future electric vehicles. The intention to create the joint venture was announced yesterday.

On June 25, 2024, Volkswagen agreed to invest an initial amount of US$1bn in Rivian through a convertible note that will convert into Rivian common stock, subject to certain conditions, upon the later of receipt of regulatory approvals and December 1, 2024. In the event of a successful implementation of the Joint Venture, Volkswagen intends to invest up to a further $4billion in Rivian and the Joint Venture.

The investment in Rivian common stock - including the convertible note - would be in total up to US$2bn and would take place through two further tranches of US$1bn each in 2025 and 2026. Upon foundation of the Joint Venture, Volkswagen will invest US$1bn in 2024 for the 50% interest in the Joint Venture and a license for using Rivian's E/E-architecture technology and grant the joint venture a loan in the amount of US$1bn in 2026.

The establishment of the joint venture and the completion of the US$4bn in additional investments are subject to achievement of certain conditions and milestones, including the receipt of regulatory approvals and the negotiation and execution by the parties of definitive agreements.

Volkswagen is represented in this transaction by an integrated German-US team consisting of Linklaters's leading lawyers in Germany and the US. The transaction demonstrates once more Linklaters' ability to provide market-leading expertise in large complex cross-border M&A transactions in all core markets. This is the first major German-US cross-border transaction after the market-leading US M&A team led by George Casey and Heiko Schiwek joined our New York office in January 2024 in a transformative step.

Linklaters has been advising Volkswagen on complex strategic transactions for years. This includes comprehensive advice to Volkswagen and Porsche in connection with the IPO of Porsche AG and the sale of a 25% stake plus one ordinary share in Porsche AG to Porsche Automobil Holding SE, the sale of Volkswagen's shares in Volkswagen Group Rus to a local investor, as well as advising Volkswagen in connection with the IPO of the Truck & Bus business (TRATON SE) and the acquisition of Navistar Inc. (USA) by TRATON SE.

The Linklaters team advising Volkswagen is led by Global Co-Chairmen of Corporate Dr. Ralph Wollburg (Düsseldorf) and George Casey (New York).

The Linklaters core team includes Achim Kirchfeld (Partner, Corporate/M&A, Düsseldorf), Heiko Schiwek (Partner, Corporate/M&A, New York), Prof. Dr. Daniela Seeliger (Partner, Antitrust, Düsseldorf), Dr. Julia Schönbohm (Global Head of TMT/IP, Partner, IP, Frankfurt), Jeffrey Cohen (Partner, Capital Markets, New York), Dr. Andreas Zenner (Partner, Corporate/M&A, Düsseldorf), Gregory Gewirtz (Partner, Corporate/M&A, New York), Kaan Gürer (Counsel, Antitrust, Düsseldorf), Dr. Julius Raapke (Counsel, Corporate/M&A, Düsseldorf), Shruti Chopra (Counsel, IP, New York), Burc Ozcelik (Senior Associate, Capital Markets, New York), Dr. Luise Winkler (Managing Associate, Corporate/M&A, Munich), Wendy Suh (Senior Associate, Corporate/M&A, New York), and Lizzeth Merchan (Senior Associate, Corporate/M&A, New York).