Chinese internet company LeEco, whose subsidiaries include media platform LeSports, has alleviated its financial concerns by securing 16.8 billion yuan (€2.31bn/$2.42bn) in strategic investment, chiefly from property developer Sunac China Holdings.
Sunac said it has made an investment worth 15.04 billion yuan in LeEco, with the Bloomberg news agency stating that the deal will make it the second-largest shareholder in the firm.
“With Sunac China, LeEco will no longer fight alone,” LeEco chief executive Jia Yueting said. “This is the first time (that) LeEco has introduced or had a second major shareholder so it’s a very important turning point.”
Bloomberg said Jia wouldn’t specify exactly where the investment will be directed, apart from saying “most if not all” would bankroll non-listed businesses under the LeEco banner. That may encompass LeSports. “The storm has finally ended,” Jia added.
LeSports last month reached a compromise agreement over its rights fee for the English Premier League that allowed it to continue covering the club football competition.
Domestic media had earlier reported that LeSports’ agreement with Super Sports Media Group, the agency which holds Premier League rights in China and Macau from 2013-14 to 2018-19, could be under threat amidst financial problems at its parent company.
LeSports signed an agreement in July to make all 380 matches from the 2016-17 Premier League season available online to its subscribers via its on-demand platforms. LeSports owed as much as $30m (€28m) in payments to Super Sports Media Group, according to Ye Rong, a spokeswoman for the agency.
However, Ye told the Reuters news agency that the two sides came to an agreement on December 27, allowing LeSports to continue streaming live games. Reuters added that LeSports had started to pay back the $30m but the repayments would only be completed in full until before the Chinese new year at the end of this month.
LeEco last month said it would cut 10 per cent of staff from its LeSports division amid ongoing concerns over rising debt. In November, LeEco secured $600m in funding, easing concerns over the sustainability of its expansion into multiple new business areas.
The news came after Jia said in a letter to staff that the firm is facing “big company disease”, casting doubt over its future in sectors such as online entertainment.