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On June 25th, Faraday Future (Faraday Future) officially announced that the Securities and Exchange Commission (SEC) approved the joint listing plan of Faraday Future (Faraday Future) and Property Solutions Acquisition Corp. (PSAC).

It is understood that shareholders of PSAC will hold a meeting on July 20, 2021 to approve the formal merger with Faraday Future by shareholder vote. Subject to the approval of PSAC shareholders and other customary closing conditions, the formal merger will be completed on July 20 and listed on NASDAQ on July 21. Upon completion of the transaction, the combined company's shares and warrants are expected to be traded under the stock codes "FFIE" and "FFIEW", respectively. According to official sources, the merger will provide about $1 billion in funding for FF, including $230 million in cash held by PSAC in trust (assuming no redemption), providing financial support for the mass production and delivery of the first flagship product, FF 91, within 12 months after the closing of the transaction.

Dr. Bi Fukang, Global CEO of Faraday Future, said, "the merger and listing with PSAC is an important milestone for FF and has been successfully achieved with the firm commitment of our employees, suppliers, partners in the United States and China, as well as the city of Humford, California."

According to data, FF is being founded in 2016 and officially launched its first mass-production electric car, the FF 91, in Las Vegas in January of the following year, after which the company announced the completion of a $1 billion round of financing, with Leeco founder Jia Yueting as the global CEO and chief product officer. Two months later, Letv left Leeco to run away from the United States in order to help raise money for Faraday's Future (Faraday). He has not returned to the United States. In 2019, Jia Yueting divided his shares in FF to creditors because of the debt crisis. In July 2020, Jia Yueting posted an apology letter entitled "working a Business, restarting my Life, with my apology, gratitude and commitment" on Weibo. In the letter, Jia Yueting said that he will work in an entrepreneurial mentality, start a business in a part-time way, and turning FF into a business is a commitment made by him and all the partners of FF.

Whether the future IPO of Faraday is successful or not will be a key turning point for mass production of FF91 models. Faraday Future announced on its website that it had reached a final agreement with SPAC on a business merger, valuing the company at about $3.4 billion (22 billion yuan) after the deal was completed, and planned to list on the Nasdaq Stock Exchange in the second quarter under the symbol "FFIE."

What is SPAC? SPAC's full name is Special Purpose Acquisition Company, which literally translates to "special purpose acquisition company". SPAC is a way of backdoor listing. Different from shell listing, SPAC, as a listing platform (shell company), has only cash but no actual business and assets. This company will invest in mergers and acquisitions of pre-listed target enterprises, and the target enterprises will quickly achieve the purpose of listing financing through mergers and acquisitions with listed SPAC.

After IPO, SPAC will have up to 2 years to find the M & A target. After a series of due diligence and financial audits on the target company, the shareholders of SPAC will vote on the project. If more than half of them approve, SPAC will promote the merger with the target company and trade on the market with the new stock symbol. If a suitable target is not found to complete the merger within two years, SPAC will be liquidated and $10 will be refunded to investors.

Compared with the traditional IPO,SPAC, it has the advantages of fast time, low cost, high success rate and simple process, which has great advantages for both investors and target companies. Of course, there are some risks in this way of listing. Investors can go public at a very small price, but the purpose of most SPAC is to achieve listing. Compared with the traditional listing methods, there is a lack of historical management accumulation and follow-up development planning. After the completion of the SPAC type acquisition in the past year or two, there is a lack of motivation for development and will soon return to the origin.

According to relevant documents, FF currently has three models with the highest-end positioning, the FF91, FF81 and FF71,FF91, which are expected to start at $100000 and are expected to be launched a year after its launch. Aimed at the upmarket mass market, FF81 is expected to start mass production 18 months after the launch of the FF91, with a target starting price of $59000. The third model, the FF71, which is aimed at the mass market, is expected to be designed and developed in 2022, with a starting price of $45000.

It is understood that the FF91 is equipped with 11 screens and is equipped with a drive motor with a horsepower of up to 1050 horsepower, with a peak torque exceeding 1800Nm and an acceleration of 2.39s at 100km. The car is equipped with a battery pack with a capacity of 130kWh. The battery life of the NEDC exceeds that of the 700km, and the domestic price is expected to exceed 2 million yuan. As the flagship model of FF, once the launch of FF91 is completed, it is of great significance to FF, which means that FF has taken an important step on the road of car construction. However, for a model with such a high cost and such a high price, it is obvious that its audience is very limited, that is, the revenue effect of this model to FF is relatively small, and FF needs a lot of money to survive. Therefore, whether it is the listing of FF or FF91, it is a new beginning and will bring new challenges.

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