Electric vehicle manufacturer Faraday Future has agreed to go public through a merger with the Property Solutions Acquisition Corp (PSAC) — a special purpose acquisition company (SPAC) — with the combined entity valued at $3.4 billion.
After the transaction is completed, the merged company, which will be named Faraday Future Inc., will trade publicly on the Nasdaq under the sticker symbol “FFIE.”
The US share price of PSAC once spiked nearly 70% before the market close on Jan. 28.
Faraday Future and PSAC said Thursday that the deal was supported by private investment of $775 million and anchor investors include leading institutional shareholders from the U.S. and Europe, a top 3 Chinese original equipment manufacturer (OEM), and a first-tier city in China. It is estimated to bring the electric vehicle maker a total of $1 billion of gross proceeds.
The deal is also expected to fully fund the production of the upcoming luxury electric FF 91 within 12 months of the deal’s close. Moreover, it will support the future development of its internet-based, autonomous driving, intelligence (I.A.I) system.
Different from traditional initial public offerings (IPOs), SPACs in recent years have attracted high-profile underwriters and investors, and have become a popular way for companies to go public since they provide entities less regulatory restrictions.
Established in 2014, Faraday Future was founded by former CEO Yueting Jia, who announced bankruptcy and owed $2 billion of personal debts in October 2019.
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According to disclosed information, Jia has as many as 29 high-consumption restrictions and has been listed as a dishonest person subject to enforcement 10 times by the supreme court.
Currently, Jia serves as the chief product and ecosystem officer at Faraday Future.
In December 2020, Faraday Future founded a new Zhuhao-based company Fafa Automobile with registered capital of $250 million, which is fully owned by FF Hong Kong Holding Limited, marking the new move of the EV maker’s expansion.
Earlier this week, Pandaily reported that the company will open a new factory in China and enlist Chinese automaker Geely to provide contract manufacturing services.
On the morning Jan. 29, Geely announced to sign a framework cooperation agreement with Faraday Future.
The two parties plan to cooperate in technical support and engineering services, as well as explore the possibility of providing foundry services by the joint venture between Geely and Foxconn.
Meanwhile, Geely will also participate in a small amount of investment in the Nasdaq listing of Faraday Future.