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July 18, 2017

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LeEco founder absent from shareholders’ meeting

THE founder of debt-laden LeEco, Jia Yueting, didn’t attend a shareholders’ meeting of its listed subsidiary, Leshi Internet Information & Technology Corp, held yesterday in Beijing.

The 15-minute meeting was held without any interactive communications with Leshi’s shareholders on site. Leshi has been suspended from trading with unresolved debts and other problems.

Leshi posted a loss of about 640 million yuan (US$92.8 million) in the first half, a reversal from a profit of 280 million a year ago, the Shenzhen-listed firm said during the weekend.

Leshi and its new investor pleaded with suppliers and investors for “more time to repay debts and a rebound in business,” which needs capital and patience.

In January, cash-strapped LeEco secured a US$2.2 billion investment from a group led by property developer Sunac China Holdings.

“It’s good business. We need more time and maybe some finance,” Sunac Chairman Sun Hongbing said at the meeting, as quoted by media.

Sun was referring to listed Leshi’s business in online video, film production and smart TV. It doesn’t include LeEco’s ambitious electric car business.

Jia, who is now in the US, quit as chairman of Leshi Internet to become chairman at LeEco’s car unit. He’s still the controlling shareholder of LeEco.

His resignation came after asset managers sought to pull investment after a Shanghai court granted China Merchant Bank Co’s request to freeze US$182 million in assets due to late interest payments.


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