Is Faraday Future -- the Chinese-American electric-vehicle (EV) start-up that was once the most-hyped emerging company in the space -- finally about to go public?
Bloomberg is reporting that Faraday Future is in talks with a special-purpose acquisition company (SPAC), Property Solutions Acquisition (PSAC +0.00%), about a merger that would value the combined companies at around $3 billion.
Bloomberg says Property Solutions is seeking to raise over $400 million ahead of the transaction, presumably the amount that Faraday requires to agree to the deal.
Los Angeles-based Faraday has been struggling to get a luxury EV called the FF 91 into production for several years. The company, led by former BMW executive Carsten Breitfeld, has said that it will be able to begin manufacturing the FF 91 about a year after it raises sufficient capital.
Faraday's FF 91 is an upscale electric vehicle that will likely compete with models from Tesla and Lucid. Image source: Faraday Future.
Faraday was once hailed as the most promising of the post-Tesla (TSLA 2.70%) EV start-ups. The company wowed audiences at the 2016 Consumer Electronics Show with a futuristic concept vehicle, and again a year later with a prototype of the FF 91. But despite ambitious -- even grandiose -- plans, the company has yet to get the car into production. Founder Jia Yueting lost control of the start-up when he filed for bankruptcy in 2019 after running up billions of dollars in personal debt.
Investors should keep in mind that as of Monday morning, there was no deal in place. It remains possible that the deal won't happen, or that it will happen under different terms. As always with such news, proceed with caution.
