Chinese internet major LeEco said it is reshuffling the executive team of its listed arm, Leshi Internet Information & Technology Corp － as the tech conglomerate continues to struggle with a cash crunch issue. Liang joined Leshi as an executive in 2012. Apart from that Leshi would also be losing its chief financial officer Yang Lijie, who apparently is resigning due to personal reasons. Zhang Wei, Leshi's China chief financial officer, will replace Yang as finance chief.
The layoffs would be the latest move to stain the company's USA brand.
LeEco encountered a cash crunch past year that Jia said was the result of that aggressive growth, with the company subsequently seeking billions of USA dollars in new funding, cutting staff and abandoning a deal to acquire United States television maker Vizio. It also heavily scaled down its operations in India and let go off about 85% of the staff. With this rapid development, the company now has to handle more businesses.
Fok said that Jia's departure from the chief executive post is a signal that shareholders lack confidence in him, and want to give another executive who has a different plan of action a chance to lead the company. In related news, CEO Jia Yueting resigned from the position last Sunday, a month after the company's intent to buy lo-cost TV maker Vizio for $2 billion fell through. Sunac might have requested this move, or there could be differing opinions from the board for this decision.
"In the future, we hope LeEco is only formed of two parts: the listed businesses and the auto unit", a transcript of an interview with Jia provided by LeEco said. The company is a part of Yueting's larger business empire known as LeEco.
Jia added that problematic businesses such as ride-sharing unit Yidao Yongche (易到用車網) will bottom out in a year or two, helped by layoffs. China Bridge Capital sold more than 60 million shares of Leshi in the first quarter of 2017 as its founder Edward Zeng called for LeEco to find a new CEO and strengthen its management.
Sunac founder and chairman Sun Hongbin stated at the company's annual general meeting on Monday that he remains optimistic about LeEco's television and film businesses, and emphasised that Sunac will not be investing in LeEco's vehicle unit.