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BUSINESS & TECH

Ride-Hail Firm Leaves Driver’s Seat Empty as Path Diverges From LeEco

By Zhou Qijun and Teng Jing Xuan
To-Win Capital’s acquisition of Yidao from LeEco remains incomplete due to disagreements over debt claims, and drivers are still waiting for payments. Photo: Visual China
To-Win Capital’s acquisition of Yidao from LeEco remains incomplete due to disagreements over debt claims, and drivers are still waiting for payments. Photo: Visual China

Chinese ride-hailing company Yidao Yongche’s leader has left the company, months after saying he would resign, as the cash-strapped startup continues its rocky transition from former owner LeEco to recent buyer To-Win Capital.

Yidao confirmed Tuesday that Peng Gang has stepped down from his position as CEO. This makes him the fifth Yidao executive with links to embattled Chinese tech firm LeEco to leave this year.

On July 17, Yidao Chief Technology Officer Yuan Bin, Chief Financial Officer Ren Ruxian, and vice presidents Liu Xiaoqing and Ma Dong handed in their notices.

Peng was formerly the chief marketing officer for LeEco, where the other four had also previously worked.

LeEco bought a 70% stake in the car-hailing company — China’s largest after Didi Chuxing — in October 2015. After the parent company’s financial woes were revealed in late 2016, its relationship with its subsidiary rapidly began to sour.

Earlier this year, drivers began complaining that they were unable to transfer payments out of their Yidao accounts, and in April, hundreds of them descended upon the company’s Beijing headquarters demanding access to their funds.

Days later, three of Yidao’s founders — Zhou Hang, Yang Yun, and Tang Peng — announced they were leaving the company. Zhou accused LeEco of having “misappropriated” 1.3 billion yuan ($197.4 million) from Yidao.

Weeks later, To-Win Capital, an obscure Beijing-based investment firm, bought an unspecified majority stake in Yidao from LeEco, in what looked like a turning point for the troubled car-hailing company. [http://www.caixinglobal.com/2017-07-14/101116006.html]

But To-Win’s acquisition of Yidao remains incomplete due to disagreements over debt claims, sources within Yidao told Caixin, and drivers are still waiting for payments.

To-Win said it had provided the financial support necessary in August for solving Yidao’s problem with its drivers, and that it would lend the firm more money in the future if the problem persisted.

Meanwhile, LeEco continues to face difficulties in its attempt to bounce back. Its listed arm, Leshi Internet Information & Technology Corp., said in an exchange filing that it would continue to suspend trading of its stock after a six-month hiatus, citing “significant and unprecedented issues” related to the company’s restructuring plan.

Contact reporter Teng Jing Xuan (jingxuanteng@caixin.com)

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