Shares of Property Solutions Acquisition (PSAC), a special-purpose acquisition company (SPAC), surged on Monday after a report that it may be close to a merger deal with electric-vehicle start-up Faraday Future.
As of 11:30 a.m. EST, Property Solutions' stock was up about 18.1% from Friday's closing price.
Bloomberg reported that Property Solutions is in talks to merge with Los Angeles-based Faraday Future in a deal that would take Faraday public at a valuation around $3 billion.
According to the report, Property Solutions is working to raise roughly $400 million, apparently the amount needed to make the merger deal happen. Faraday has said that its luxury electric vehicle, the FF 91, could be in production in about a year after it raises additional capital.
Many analysts thought Faraday could emerge as a Tesla competitor after the company's impressive presentation at the Consumer Electronics Show in 2016. But after unveiling the FF 91 a year later, Faraday's momentum stalled as co-founder Jia Yueting racked up debt while trying to build a business empire in China, and many early Faraday employees left.
Faraday is now led by a former BMW executive, Carsten Breitfeld, and it appointed former FOX Factory Holding chief financial officer Zvi Glasman as its CFO just last week. While auto investors should be cautious here -- the deal isn't yet official, and things could change quickly -- it does appear that Brietfeld is assembling the pieces needed to finally get the FF 91 into production.