LeEco Secures Most of 15 Billion Yuan Investment From Sunac
(Beijing)—The majority of Sunac’s 15 billion yuan investment into LeEco is now in place, easing the struggling tech giant’s financial woes. The move makes the property developer the second-largest owner of cash-strapped LeEco.
Transfer of 6 billion yuan worth of shares of the video-hosting arm of LeEco to Shanxi-based Sunac China Holdings has closed, said a statement Thursday on the Shenzhen bourse.
In accordance with the original agreement, LeEco Chairman Jia Yueting’s 34% stake in the company has been lowered to 26% after the transference.
A separate announcement yesterday provided updates on the remainder of Sunac’s investments in LeEco’s non-listed companies: 5.5 billion of a pledged 8 billion yuan investment has been injected into Leshi Zhixin, LeEco’s television-making division, and 1 billion yuan has been allocated to LeEco’s film production subsidiary, Le Vision Pictures.
LeEco has been plagued by a cash crunch due to rampant expansion into areas such as smartphones, electric cars and sports deals. In January, it secured urgently needed funding of 16.8 billion yuan from property developer Sunac and other investors.
Apart from Sunac’s pledge to invest 15 billion yuan in LeEco’s video-hosting, film and television-manufacturing businesses, LeRan Investment, a company affiliated with Chairman Jia Yueting’s family, and Hua Insurance promised to invest a total of 1.8 billion in Leshi Zhixin, often seen as the most promising arm of LeEco’s sprawling hardware and content kingdom.
The 1.8 billion yuan funds are already in place, according to a separate stock filing on the same day.
As the much-needed funds arrive to fill LeEco’s cash gap, the company is also making progress in sorting out a deal to purchase web-series production house Leyang Films, owned by Chairman Jia Yueting’s wife, former actress Gan Wei.
Jia’s wife has agreed to sell her majority stake in Leyang to LeEco for half its market value, which is still under review. Previous reports claimed that a recent round of funding valued the company at 1.2 billion yuan.
LeEco and Leyang were asked by China’s security regulators in February to disclose and rectify any similar business operations, as rules for Shenzhen-listed firms stipulate that companies remain independent from the interests of major shareholders and affiliated parties.
Contact reporter April Ma (firstname.lastname@example.org)
- 1China’s Moon Explorer Posts Photo of Sprouting Cotton Plant
- 2Huawei Canada Exec Quits as Scandal Continues to Embroil Company
- 3Luckin Coffee Reportedly Seeks IPO in Hong Kong
- 4Bank of China to Test Waters for Perpetual Bonds
- 5Apple Chief Counsel Accuses Qualcomm of Holding Phone-Makers for ‘Ransom’
- 1Power To The People: Pintec Serves A Booming Consumer Class
- 2Largest hotel group in Europe accepts UnionPay
- 3UnionPay mobile QuickPass debuts in Hong Kong
- 4UnionPay International launches premium catering privilege U Dining Collection
- 5UnionPay International’s U Plan has covered over 1600 stores overseas