Faraday Future wants out of key financial deal

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It comes at a delicate moment for the fledgling EV maker.

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.

To no one’s surprise, Evergrande saw things differently. It said it had been manipulated into paying Faraday $700 million in July (at Jia’s behest) after the automaker had burned through Smart Season’s initial $800 million. Evergrande also accused Jia of trying to strip the company’s rights to approve future financing deals.

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