China’s Leshi Holdings, which controls internet company LeEco, has secured $600m (€543.5m) in funding amid concerns over the sustainability of its expansion into multiple new business areas.
LeEco controls OTT operator LeSports and Leshi said the fund commitments will come from more than 10 Chinese companies, adding that an initial $300m will be delivered by the end of the month and be directed towards LeEco Global and the firm’s automotive business.
The Forbes website added that the company’s billionaire founder Jia Yueting signed the financing agreements in LeEco’s Beijing headquarters with senior executives from firms including Jiangsu-based apparel maker Heilan Group, Hong Kong-listed furniture company Man Wah Holdings and Shandong-based pharmaceutical firm Luye Group. They are said to be personal investments from Jia’s classmates at the Cheung Kong Graduate School of Business in Beijing.
Jia last week revealed in a letter to staff that LeEco, which has invested in high-tech products from electric cars to smartphones, was facing a shortage of cash and suffering from expanding too quickly and in too many different areas.
LeSports’ most recent significant deal came in September as it acquired rights in Hong Kong and Macau to North American basketball league the NBA. The five-season deal runs from 2016-17 to 2020-21.