Chinese billionaire Jia Yueting, the founder of an electric-vehicle startup and an internet streaming service, filed for chapter 11 bankruptcy in the U.S., seeking protection from banks and other creditors that are owed as much as $3.6 billion, WSJ Pro Bankruptcy reported. A major investor in car maker Faraday & Future Inc., Jia filed for bankruptcy yesterday with a plan to set up a creditor trust and relinquish his equity in Faraday owner Smart King Ltd. to help repay his debts. In 2017, Faraday had to give up a $335 million incentive package it was on track to receive from Nevada to build a $1 billion factory in North Las Vegas. The plan fell apart after Chinese courts froze the assets of Jia, also the founder of Chinese technology business LeEco Holdings. Most of his debts currently stem from his personal guarantees or money he borrowed personally on behalf of companies that he founded or led. He has about $1 billion in assets, according to a filing in U.S. Bankruptcy Court in Wilmington, Del. Jia will no longer hold his equity interest in Smart King, under a proposed chapter 11 restructuring plan, but he said he plans to continue to work with the company. Under certain conditions, he also may get representation on the creditor trust committee, according to a nonbinding creditor trust term sheet filed with the court. The plan also includes a management incentive equity plan for Smart King under which he may participate.
