LeEco (Chinese: ????; pinyin: Lèshì Sh?ngtài) is a Chinese multinational conglomerate corporation founded by Jia Yueting, the founder of Le.com (aka LeTV). The group maintains ventures in consumer electronics, automobiles, film and other business. The holding company of the group is known as Leshi Holding (Beijing) Co., Ltd. (Chinese: ????(??)????; pinyin: Lèshì Kòngg? B?ij?ng Y?uxiàn G?ngs?).
LeEco has expanded to countries outside of China, such as the United States and India.
From 2016 onwards, LeEco has been experiencing significant financial problems.
Video LeEco
History
Le.com, formerly Letv (Chinese: ???; pinyin: lèshì w?ng; literally: "Leshi Network"), was founded by Jia Yueting in Beijing in 2004 and was the first streaming video company in China to go public. Jia later founded Leshi Holding as a sister company of Letv to provide media content and products that linked to its services. Both Letv services and Leshi products were marketed internationally under the Letv name until January 2016, when media services began under the Le.com name (Chinese: ????; pinyin: lèshì shìpín; literally: "Leshi Video") and electronics products were labeled LeEco.
In July 2016, it was announced that LeEco would acquire American television manufacturer Vizio for $2 billion. Vizio was to be operated as an independent subsidiary in southern California, while Vizio's Inscape Data Services was going to be spun out into a privately held company. The acquisition was later cancelled.
LeEco officially expanded into the US market in November 2016, beginning sales of mobile phones, televisions, headphones, and eventually "smart bicycles" on its privately owned marketplace LeMall (Chinese: ????; pinyin: lèshì sh?ngchéng). It previously expanded into India in 2015.
Billionaire CEO Jia Yueting announced in November 2016 stagnation and management problems in a letter to his employees. He plans to invest US$10 million and to reduce his base salary to US$0.15 in order to allow the company to expand into the United States. These issues within the company included cutting 10% of its workforce and considering selling non-core business units such as LeSEE and real estate ventures.
On 23 November 2016 Compal Electronics confirmed that LeEco failed to pay a debt of NT$ 4.25 billion, which was rescheduled and paid in-time.
In late November 2016, LeEco announced a partnership with American telecommunications company AT&T to include its Internet-based cable TV streaming service DirecTV Now on LeEco "ecophones" and "ecotvs".
On 1 December 2016, LeEco started selling products in the United States through national retail chains Amazon.com, Target, and Best Buy, as well as continuing sales and after-sales support through its LeMall.com marketplace.
In late 2016, the chairman Jia Yueting admitted that the company was facing acute financial troubles, stating: "We blindly sped ahead, and our cash demand ballooned. We got over-extended in our global strategy. At the same time, our capital and resources were in fact limited." The company has indicated that it will raise billions of dollars from investors, but did not specify where the money would come from or how it would be allocated.
In late November 2016, a town hall meeting was held at the Silicon Valley headquarters with executives attempting to calm employees down in response to its press coverage and company status. Executives told employees that the media was misreporting the story and that this was just "YT being YT". Employees were assured that there will be no layoffs and were promised year-end bonuses and raises.
In early December 2016, layoffs were conducted in Hong Kong, India (80% of workforce) and the US. At the time, the company did not want to attract media attention to the US operations. Therefore, only India and Hong Kong layoffs were reported. However, multiple reports concluded that the first wave of layoffs in the US started as early as November 2016, with the recruiting team being the first to let go, following employees from different departments.
On 5 January 2017, Haosheng Electronic Technology (NEEQ: 838701) announced that they sued LeMobile for non-performing debts of CN¥11,020,393.22 and US$5,929,259.14 respectively.
On 13 January 2017, a 15% stake of Le Vision Pictures was agreed to be sold from Leshi Holding to Tianjin Jiarui, a subsidiary of Tianjin Yingrui Huixin (a company managed by Sunac China in order to bypass restriction on foreign investments) for CN¥1.05 billion. In a separate deal, Tianjin Jiarui acquired rights to nominate a member to the board of supervisors of LeMobile. LeEco's minority stake in the TV manufacturing subsidiary of Le.com (Leshi Zhixin) would also being diluted to 18.3805% due to the subscription of new shares by Tianjin Jiarui and other investors.
In April 2017, the company announced that it had scrapped its acquisition of Vizio, citing "regulatory headwinds", but that it would "continue to explore opportunities".
On 22 May 2017, an email sent to CNBC revealed an internal meeting with employees in the Silicon Valley global office to lay off more than 325 employees, 70% of the workforce. At the time of its US expansions, LeEco owned its Silicon Valley office. Since the financial crisis, the company had to give up their ownership and sell their property to Han's Group, based in Shenzhen. The company now pays a monthly rent and will only occupy 1/4th of the office, leasing out the remaining spaces for other potential companies by new owners.
A Shanghai court froze CN¥1.24 billion of LeEco's assets in July 2017 due to defaulted payments on a LeView Mobile loan to China Merchants Bank.
As of July 2017, former CEO Jia Yueting has fled his home country in China to work at Faraday Future in southern California after his assets were frozen by a Shanghai court. He has since visited Hong Kong for a short period of time for an attempt at receiving funding from investors, only to be avoided due to his negative reputation.
Maps LeEco
Subsidiaries or Announced Acquisitions
LeMusic
LeMusic's (Chinese: ????; pinyin: lèshì y?nyuè) establishment was announced in Hong Kong in 2015. Yin Liang (??), core creator of LeEco's music business, was appointed chief executive officer of the new music company, while Lei Zhenjian was appointed chairman. Its model includes a pay-per-view live concert model which has produced over 300 concerts as of 2015.
LeMobile
LeMobile (Chinese: ????; pinyin: lèshì yídòng), a subsidiary of Leshi Holding, produces high-end smartphones under the LeEco brand. Its most recent smartphones include the Le Pro 3 and Le S3.
On 21 September 2016, LeEco unveiled the Le Pro 3 in China. It went on sale in China and the United States in early November 2016. LeMobile will launch both aforementioned models in India in December 2016.
LeSEE
Leshi Holdings set up their electric vehicle branch in January 2015, LeSEE (Leshi Super Electric Car Company) and launched a concept model with Faraday Future at CES 2016. It also showed the Chinese-manufactured derivative at the 2016 Beijing Auto Show, the Le Supercar. The Le Car luxury vehicle with engineering talent from Lotus has also been shown. It also tried to lure in more talents in the field to develop their own products such as hiring Ni Kai (Chinese: ??), who was the former director of Baidu's driverless car project. In April 2016, LeEco presented it's very first model of its self-driving car named LeSEE (Super Electric Ecosystem) during a press conference in Beijing.
Its future is uncertain as of late 2016 when construction for the Faraday Future plant in Nevada stopped and suspicions of financial woes within LeEco and Faraday Future rose. LeEco announced in the last week of December 2016 that they had broken ground for a US$3B (20B yuan) factory in Huzhou, Zhejiang. CarNewsChina reported that LeEco said the site will be 4,300 acres in size. LeEco plans to build a vehicle factory, a battery factory, and a traction motor factory. LeEco expects production rate to be around 200,000 cars a year at first, and then work up to a full capacity of 400,000 cars a year.
Film studios
LeEco is the owner of Le Vision Pictures. On 5 December 2015, it was announced that the film studio would be sold to Le.com. As of 8 November 2016, the deal was still in the phase of valuation.
In September 2016 the company announced the acquisition of Dichotomy Creative Group and the creation of Le Vision Entertainment, a US-based film studio.
Le VR
Le VR (Chinese: ??????; pinyin: lèshì x?n?xiànshí) is a company that invests in virtual reality technology. Its products are currently only available in China.
Sister companies
LeEco Global Holding
Jia Yueting, also owned 28.83% shares of Hong Kong listed company Coolpad Group (as the largest shareholder and chairman of the board) via Cayman Islands-incorporated Lele Holding (and its subsidiary LeEco Global Holding), which had no parent-subsidiary relation with China-incorporated Leshi Holding (Beijing), the parent company of mainland China part of LeEco.
It was reported that LeEco Global Holding opened a call centre in Russia in 2016.
Le.com
Leshi Holding (Beijing) owned 0.6% shares of Shenzhen listed company Le.com, which the largest shareholder was LeEco chairman Jia Yueting.
LeRan Investment Management
Ningbo Hangzhou Bay New District LeRan Investment Management, a private equity fund, was partially owned by Jia Yueting and Leshi Holding (who also owned the management company (general partner) of the fund). LeRan Investment Management was the shareholder of Leshi Zhixin for 3.9486% stake, which Leshi Holding (Beijing) owned 17.9497%.
LeSports
LeSports is a sports video streaming service.
References
External links
- Official website (USA)
- Official website (China)
Source of the article : Wikipedia
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