Sumary of Faraday Future Shares Slump on Nasdaq Debut:
- The electric car startup of disgraced Chinese billionaire Jia Yueting started trading in New York after merging with a special purpose acquisition company (SPAC) that agreed to provide $1 billion of gross proceeds to the company.
- The stock opened at $16.84, rose as high as $17 and later traded at $13.85. The long-struggling electric-car company made a deal in January for funding from Property Solutions Acquisition Corp.
- , an American company formed for the purpose of buying other companies.
- Caixin learned from several sources that it was the Zhuhai municipal government in South China’s Guangdong province that dropped out.
- Jia is best known in China for founding the once-high flying tech company LeEco, known as Leshi in Chinese, which crashed to earth in 2017. Jia was officially listed as a debt defaulter by the Chinese government in late 2017 and filed for bankruptcy in 2019. He has also been sued by 11 individual investors alleging fraud.
- Jia is thought to have fled the wreckage in mid-2017 and spent most of the time since in the U.S. focusing on the EV company.
- The cornerstone investor that dropped out of the SPAC deal, identified as the government of a first-tier Chinese city, failed to exchange its yuan funds to U.S. dollars as it couldn’t get regulatory approval from the State Administration of Foreign Exchange, Faraday Future said July 15 in a filing with Securities and Exchange Commission.
- Chinese state-owned companies Zhuhai Gree Group and Zhuhai Huafa Group were considering investing in the SPAC deal, local Chinese press reported.