Faraday Future plans reverse stock split and delays EV deliveries
6:32 pm Friday, June 16th, 2023
(Reuters) -Electric-vehicle startup Faraday Future Intelligent Electric said on Friday it was planning a reverse stock split, as it looks to regain compliance with Nasdaq’s minimum bid price requirements.
Nasdaq requires shares trade above $1 and sends a notice when a company trades below that mark for 30 consecutive business days.
Companies then have a 180-day period within which the stock has to trade above $1 for at least 10 consecutive days to comply with the rules, although a second 180-day period can be granted if they meet other requirements.
In May, Faraday Future had received the additional 180-day extension from Nasdaq to meet minimum bid price requirement after having received a notice in January notifying it did not satisfy the continued listing rules.
Faraday Future closed at $0.45 on Friday.
So far this year, electric-truck maker Nikola has said it may execute a reverse stock split, while Lordstown Motors has also announced a reverse stock split to meet Nasdaq listing norms.
Faraday’s reverse stock split proposal includes a range between 1-for-2 and 1-for-90 shares of outstanding common stock. The final ratio will be determined by the Board following stockholder approval.
The Los-Angeles based company has been struggling with a cash crunch and a board reshuffle following a governance dispute with one of its largest shareholders, FF Top Holding. Last November, Faraday Future raised doubts about its ability to continue as a “going concern”.
The company on Friday also pushed back the phase 2 delivery of its FF 91 2.0 Futurist Alliance vehicle from the end of the second quarter to August 2023.
(Reporting by Samrhitha Arunasalam in Bengaluru; Editing by Krishna Chandra Eluri)
