A string of electric-vehicle startups have all gone public in the past year via a so-called “reverse merger” with a special purpose acquisition company (SPAC) whose shares are already listed, and now it looks like Faraday Future and Lucid want to jump on the bandwagon.
Citing people familiar with the matter, Bloomberg reported last week that Faraday Future and Lucid are in talks with prospective partners, with Property Solutions Acquisition Corp. specifically mentioned as one of the SPACs in talks with Faraday Future and Michael Klein, an investment banker with two SPACs looking for a partner, said to be in talks with Lucid. Klein has previously worked with Lucid’s main shareholder, Saudi Arabia’s Public Investment Fund, including advising on the recent initial public offering of Saudi Aramco, Saudi Arabia’s national oil company.
In the case of the Lucid deal, the public company could be valued at up to $15 billion, according to one of Bloomberg‘s sources. Lucid already has its own plant and is due to start production of its class-leading Air sedan later this year. As for the Faraday Future deal, it is expected to yield a company valued at $3 billion.
2021 Lucid Air
Faraday Future looked promising in 2017 when it unveiled the FF91 crossover SUV but hit a snag shortly after when main Chinese backer, Jia Yueting, ran into financial troubles of his own. The company had to cut costs and delay the start of production of the FF91, and Jia was eventually replaced as CEO of Faraday Future in 2019.
Faraday Future in an update in January said the FF91 could be on sale within a year of the company closing a successful round of funding.
Only last month, fellow EV startup Canoo went public via a reverse merger with Hennessy Capital Acquisition Corp. Other EV startups that have done the same include Nikola, Lordstown Motors, and Fisker. Another EV startup, Mullen Technologies, also plans to go public via a reverse merger.