The company plans to use proceeds from the upcoming funding round as a bridge to an initial public offering, Chief Executive Officer Carsten Breitfeld said in a phone interview. He took over the job weeks before Jia Yueting, Faraday’s Founder, filed for bankruptcy in the U.S. after running up billions of dollars in personal debts trying to build a business empire in China.
Faraday, which is less than six months removed from securing $225 million of financing, will select a lead investor for the upcoming round by the end of this year, and both new and existing backers will participate, Breitfeld said. The company’s capital needs mean an IPO “cannot be in the too far future” while acknowledging that conditions for an offering aren’t ideal.
This year’s surge of technology and tech-related IPOs peaked with Uber Technologies Inc.’s $8.1 billion listing in May. Dismal performances by two offerings topping $1 billion in September -- SmileDirectClub Inc. and Peloton Interactive Inc. -- combined with the collapse of WeWork’s plans to go public have taken steam out of the IPO rush. In a proposed debt-restructuring plan in federal court in Wilmington, Delaware, Jia said he will use his ownership stake in Los Angeles-based Faraday to set up a creditor trust to repay his debts.
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