According to informed sources, if Faraday Future fails to complete Series A financing by December, a convertible bond of more than 400 million U.S. dollars at a 12% interest rate will be paid immediately, and the electric carmaker will have to deal with about 1 Hundreds of millions of unpaid accounts.
People familiar with the matter said the company needed to raise funds to repay Chinese investors who financed the debt, but after months of searching, the company has been unable to raise funds.
This year, Jia Yunting abandoned control of LeTV, the latter often referred to as 'China's Netflix.' Jia Yueting focused his attention on Faraday Future, which aims to combine Chinese cash with Western technology to challenge Elon-Ma Tesla Motors, Elon Musk.
According to one of the informed sources, one of the problems with the financing of this electric car startup was its inability to allow mainland regulators to approve its transfer of funds abroad.
In a statement, the company said: 'We recognize that we are in the process of round A financing, in addition to no comment.'
Faraday was shocked by the world-wide launch of a 1,000-horsepower prototype Batmobile that appeared two years ago at the CES Las Vegas, where he plans to set up a $ 1 billion manufacturing facility in the Nevada desert, And create 4,500 jobs by 2017.
But later the production plant was discontinued, Jiayue Ting admitted that due to the rapid development and product segmentation too much, music is facing a shortage of funds.In addition to video streaming business, music as Internet information technology company also develops smart phones, movies and television etc. product.
Now Faraday Future needs more money to make a real car, not just a prototype car, when sources said the company is seeking $ 1 billion in financing.
Informed sources said that if 500 million U.S. dollars financing success, those debt will be converted into stock.
In January of this year, Sunac and other investors bought shares of LeTV and its related companies worth Rmb16.8bn, of which Rmb10bn was owned by Jia Yueting and later resigned as LeTV's leadership position.
According to people familiar with the matter, Faraday Future has secured at least a $ 30 million transitional loan, and the company owes its employees bonus and 2016 pay rise.
Informed sources said the company hopes the A-round financing companies in the valuation of 1.5 billion to 2 billion US dollars, but parts manufacturers and media partners require the company to pay the unpaid money and the court began to freeze the shares of Jiayue Ting After the potential investors left.
Media reports said Tata Motors, the Indian automaker, has invested 900 million U.S. dollars in Faraday for a valuation of 9 billion U.S. dollars, but Tata Motors has denied these reports.
It is reported that in October last year, former chief financial officer Tefan Krause (Tefan Krause) looking for alternative funding is also preparing to apply for bankruptcy protection.According to informed sources, Jia Yueting eventually gave up the plan and all may lead to He loses the control of this business proposal.
According to people familiar with the situation, Mahindra & Mahindra, the Indian automaker, was deliberately acting as a "cover horse" and opened an auction for court supervision, and the company declined to comment.
Faraday Future issued a statement this month on its website that it has terminated the contract with Claus and former chief technology officer Ulrich Kranz, both from BMW, The media said that they resigned in October, the two did not disclose the termination clause and potential legal proceedings.