Jia Yueting, an entrepreneur who ran up billions of dollars in personal debts trying to build a business empire in China, has filed for bankruptcy in the U.S. with plans to turn over his latest venture, an electric vehicle startup, Faraday to creditors.

In a proposed debt-restructuring plan filed in US federal court in Wilmington, Delaware, Jia will use his ownership stake in Los Angeles-based Faraday & Future Inc. to set up a creditor trust to repay his debts.

Jia faces $2.3 billion in claims, according to the plan. In a statement on Faraday’s website, the company said Jia’s debts were owed to creditors in China.

The plan is also designed to help Faraday put together “equity financing efforts and prepare for an IPO,” according to the statement. Depending on the value of that proposed initial public offering, creditors may recover from 49% to 100% of what they are owed, according to reorganization plan documents filed in court.

Faraday is trying to develop an electric vehicle for sale in the U.S. and China. The company recently hired Carsten Breitfeld, BMW AG veteran, to take over the chief executive officer role from Jia.

Faraday won a much-needed cash infusion when it formed a joint venture earlier this year with The9 Ltd., the Chinese online-gaming company. And a unit of China Evergrande Group, the property developer owned by Hui Ka Yan, China’s third-richest man, agreed to invest $2 billion, but cut back on the investment after giving Faraday $800 million for a 32% stake, according to court documents.

Jia has a history of making dramatic statements about his various ventures, including a claim that one of his biggest China-based businesses would “far surpass” China’s three biggest internet companies: Baidu Inc., Alibaba Group Holding Ltd. and Tencent. That claim was related to $2.2 billion Jia raised for LeEco, a sprawling conglomerate with interests ranging from electric cars and TVs to entertainment.

In his first international television appearance in 2016, he called Apple Inc.“outdated” and said he expected his electric vehicle company to “lead the industry leapfrogging to a new age.”

In his bankruptcy filing, Jia warned that his IPO plans for Faraday may not raise as much as projected. That was due in part to “negative press related to his debts and an investigation by the China Securities Regulatory Commission into the delisting from the Shenzhen Stock Exchange” of a company where Jia served as chief executive officer.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world