No, you have give the settlement to yourself and then to the faction you want, so you may be forced to forcing a ceasefire on someone, though if they are along way away use normal diplomacy!

Tip; if you want to help someone I always disband the units you get in the settlement to boost the pop, and destroy any buildings that won't help them and repair any that might.

Be aware FD used alot can cause CTD's, so if possible if you are gifting a settlement use normal diplomacy about 10K cash helps and start with settlemnts that border the other faction.