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Faraday Future comes crawling back to its main investor
Faraday Future is ending its very tumultuous year on a positive note... in a manner of speaking. The electric car startup has reached a restructuring deal with its main investor, Evergrande Health's Season Smart, that will put legal battles in the past and potentially keep the money flowing. The two sides have dropped their earlier contract, and Faraday has pulled litigation that tried to force Evergrande to cough up cash. The pact both lifts a hold on the EV maker's assets and removes limitations on its equity financing, theoretically freeing it to take on financing that just wasn't an option before.
Faraday Future wants out of key financial deal
Things have mostly been looking up for Faraday Future lately, at least on the surface: it has a line of cash, testing has been in full swing, and it even started building pre-production electric cars at its US plant. The situation might not be quite as comfortable as it seems, though. A stock exchange filing has revealed that Faraday Future is pushing for arbitration that would cancel a deal to sell a 45 percent stake in the EV startup to China's Evergrande Health Industry Group. Faraday chief Jia Yueting accused Evergrande of not fulfilling its end of the bargain, which includes both buying the company with the 45 percent stake (Season Smart) for $860.2 million and paying two $600 million installments in 2019 and 2020.
