ff> How not to start a company& leapfrog into unpaid bills w/ a lack of funding

classic Classic list List threaded Threaded
1 message Options
Reply | Threaded
Open this post in threaded view

ff> How not to start a company& leapfrog into unpaid bills w/ a lack of funding

Electric Vehicle Discussion List mailing list

Chinese Rival to Tesla Faces a Debt Crunch
November 27, 2017  Selina Wang, David Ramli and Giles Turner   P R Sanjai

The Faraday Future FFZero1 concept vehicle  Photographer: Qilai

The dwindling empire of China’s Jia Yueting, who once boasted he would
leapfrog Tesla Inc., faces a new hurdle as his U.S. electric car startup
struggles to raise a $500 million funding round, people familiar with the
matter said.

[image]  Jia Yueting Photographer: David Paul Morris/Bloomberg

A convertible note of more than $400 million, with a 12 percent interest
charge, becomes payable immediately if Faraday & Future Inc. can’t raise the
Series A round by December, the people said, asking to not be identified as
the matter is private. The electric carmaker, which is also dealing with
about $100 million of unpaid bills, hasn’t been able to line up funding
after months of searching as it tries to pay off Chinese investors who
financed the debt, the people said.

Jia gave up control of his crown jewel, a Netflix-like business in China,
this year and turned his focus to Faraday, which has ambitions of combining
Chinese cash with Western technology skills to challenge Elon Musk’s Tesla
in electric vehicles. Part of the company’s problem with fundraising is an
inability to get mainland regulators to approve transfers of money out of
the country, one of the people said.

“We decline to comment, other than we acknowledge that we are in the process
of our round A fundraising,” the company said in a statement.

Faraday made global waves two years ago when it unveiled a 1,000-horsepower
prototype that looked like the Batmobile at the CES technology show in Las
Vegas. Jia planned to erect a $1 billion production plant in the Nevada
desert and create 4,500 jobs manufacturing cars by 2017.

But work on the plant later stopped as Jia admitted that his LeEco empire
faced a cash crunch after growing too quickly and across too many product
segments. In addition to the video streaming business, Leshi Internet
Information & Technology Corp., his businesses developed smartphones, movies
and TVs.

Now, Faraday needs the additional cash to be able to produce actual cars,
rather than prototypes. In May, the company was seeking to raise $1 billion,
a person familiar with the matter said at the time.

If the $500 million funding succeeds, the debt will convert into shares, the
people said. LeEco directed requests for comment to Faraday.

Jia scored a lifeline in January when property group Sunac China Holdings
Ltd. and other investors bought 16.8 billion yuan worth of shares in Leshi
and other related companies, 10 billion yuan of which was in exchange for
stock owned by Jia, who later stepped down from leading the company.

Faraday has already had at least one $30 million bridge loan, the people
familiar said. Employees are also owed bonuses and 2016 pay increases, the
people added.

The company sought out investors that valued the business at between $1.5
billion and $2 billion this year, but potential investors walked away after
component makers and media partners demanded money for unpaid bills and
Chinese courts began to freeze his shares, the people said. Tata Motors
Ltd., the Indian carmaker that owns Jaguar, strongly denied Chinese media
reports that it had invested $900 million in Faraday at a $9 billion

[image]  Stefan Krause  Photographer: Martin Leissl/Bloomberg

Stefan Krause, who was chief financial officer before leaving in October,
prepared filings for a Chapter 11 bankruptcy while searching for alternative
funds, people familiar with the filing said. Jia ultimately killed the plan
along with all other proposals that would result in him losing control of
the business, the people said.

The Indian car-maker Mahindra & Mahindra Ltd was interested in becoming a
“stalking horse” to set the opening bid as part of a court-supervised
auction, the people said. Mahindra declined to comment.

Faraday said it “terminated” Krause and former Chief Technology Officer
Ulrich Kranz, according to a statement posted on its website this month.
Both men, alumni of BMW, told Bloomberg News they quit in October. They
declined to comment further on the terms of their departure, pending
potential legal action.
[© 2017 Bloomberg]

Faraday Makes a High-Profile Hire From BMW to Get the FF 91 on the Road
July 17, 2017  Faraday Future, the electric car startup backed by an
under-siege Chinese ... Ulrich Kranz, the head of BMW's Project i electric
vehicle team, has joined Faraday ...
BMW lifer brings steady hand to electric-car maker Faraday
July 17, 2017  Faraday Future, the electric car startup backed by an
under-siege Chinese entrepreneur, has made another high-profile hire at a
time of desperate need for ...
MAD unveils "extraterrestrial" campus for electric car brand Faraday Future
Jul 18, 2017  Chinese architecture studio MAD has designed a
sci-fi-influenced headquarters for Faraday Future, a new car company
focussed on electric vehicles ...
Faraday Future moving out of North Las Vegas City Hall
August 1, 2017  Faraday Future gave a 30-day notice to move out of offices
leased inside North Las Vegas City Hall as company executives look for an
existing building to ...
Faraday Future leases central California factory in attempt to keep its
electric car dreams alive
Aug 6, 2017  Just last month, Faraday Future scrubbed its ambitious plans
for a $1 billion megafactory in Nevada. Now, the electric vehicle startup
has found a new location ...
Faraday Future raises $14M, leases old factory for future electric car line
Aug 7, 2017  Faraday Future announced on Monday that it has signed a lease
on a turn-key manufacturing facility in Hanford, California, south of
Fresno. The company has ...
Faraday Future may cut its Formula E team to save cash
Aug 15, 2017  The electric car startup has struggled to get its factory
project off the ground, lost executives, and ... “Where there is smoke there
is fire,” he wrote in a follow-up.
LeEco’s EV subsidiary CEO resigns and joins rumored affiliate
October 17,2017 - Zhang Hailiang, vice president and chief executive of
LeEco's electric car affiliate Le Supercar, reportedly resigned as chief
executive and ...
CFO Brought On To Get Faraday Future On Track Apparently Headed For The Door
After Eight Months
11/09/17 The company—led by its main financier, Chinese billionaire Jia
Yueting, who found the electronics titan LeEco—introduced an electric
autonomous car at this ...
Faraday No Future: Things Looking Dim for EV Startup
November 10, 2017  There's little clarity in the future of Faraday Future,
the three-year-old California startup hoping to build high-end electric
vehicles. Reports have top executives ...
Faraday Future's EV plans are floundering as execs jump ship
Nov 10, 2017  Faraday Future is discovering it's harder than you might think
to start a brand-new electric car company, with numerous executives leaving
amid struggles to ...
Faraday Future issues bombastic statement accusing former CFO of
‘malfeasance and dereliction of duty’
Nov 10, 2017  Stefan Krause, previously of BMW, calls the claims ‘baseless’
Hours after it was made public that struggling electric car startup Faraday
... of options to save the company and its goal of manufacturing an electric
vehicle ...
Faraday Future loses three top executives as manufacturing stalls
Nov 10, 2017  Savior CFO Stefan Krause is out, and the company is in a
‘holding pattern’
Faraday Future emerged out of stealth mode in 2015, promising to deliver an
electric vehicle with the performance of a Tesla and advanced technology
like ...

For EVLN EV-newswire posts use:


Sent from: http://electric-vehicle-discussion-list.413529.n4.nabble.com/
UNSUBSCRIBE: http://www.evdl.org/help/index.html#usub
Please discuss EV drag racing at NEDRA (http://groups.yahoo.com/group/NEDRA)