(Yicai Global) Jan. 26 -- Debt-ridden electric vehicle startup Faraday Future is seeking a new round of financing in China, and Geely Holding Group has expressed interest, as has China Evergrande Group, 36Kr reported, citing insiders.

“Geely will invest USD30 million to USD40 million in Faraday,” an insider said. “The news will be announced next week at the soonest.” Property developer Evergrande also took part in the talks, which was unexpected considering its previous falling out with US-based Faraday, 36Kr said. 

In 2018, Guangzhou-based Evergrande had planned to invest USD2 billion in Faraday Future for a 45 percent stake as part of plan to diversify its business. Evergrande gave Faraday USD800 million that year for the latter to build a factory in Hanford, California and to hire a workforce in excess of 1,000 people.

But Faraday later accused Evergrande of not fulfilling a promise to provide USD700 million, and Evergrande accused Faraday of having no products or assets to offer. The two sought arbitration in October 2018. Evergrande agreed to release control over Faraday’s assets, and its stake was scaled back to 32 percent, according to a statement to the Hong Kong Stock Exchange.

Faraday Future plans to produce electric vehicles in China and wants Hangzhou-based Geely to provide contract manufacturing services, Reuters reported yesterday, citing three sources familiar with the matter.

Faraday aims to produce 100,000 vehicles a year in the initial phase, and Geely will help improve the model's engineering and add smart car technologies including autonomous driving functions, according to the sources.

Market Debut Plans

The company is also in merger talks with Property Solutions Acquisition, a deal that would take Faraday public with a valuation of around USD3 billion, Bloomberg reported previously. Faraday will submit the listing documents within two weeks and is likely to unveil information on the deal in China at that time, 36Kr reported.

Faraday and Geely declined to comment.

Chinese entrepreneur Jia Yueting formed Faraday Future in Los Angeles in 2014 and unveiled its FF91 vehicle the same year. But production has been postponed several times because of personnel changes and financing problems.

Faraday set up a new firm, Fafa Automobile Zhuhai in China’s Guangdong province last month. Faraday aims to make the FF91 in the country, Chief Executive Carsten Breitfeld said, noting that the firm is negotiating with Chinese automakers about cooperation.

Editor: Tom Litting