China's LeEco founder resigns amid financial crunch
Jia Yueting, co-founder, and head of Le Holdings, also known as LeEco and formerly as LeTV, poses for a photo in front of a logo of his company
Leshi Internet Information & Technology Corp Beijing said Jia Yueting will remain controlling shareholder without any role
The founder of China's debt-ladenLeEcoresigned as chairman of its main listed unit, just hours after making a public plea for patience amid a deepening financial crisis at the entertainment, electronics and electric vehicles group.
Leshi Internet Information & Technology Beijing said Jia Yueting will remain controlling shareholder without any role, having resigned as chief executive in May to focus on the electric car business, of which he will now become chairman.
The announcement came after Jia on social media promised to repay debt and reaffirmed LeEco's electric car commitment.
"Please giveLeEcosome time, please giveLeEcocar some time," Jia Yueting wrote in Chinese on his Weibo and WeChat accounts. "We will pay back creditors, suppliers and any other debts."
The plea came about a month after Jia said a cash crunch atLeEcowas "far worse than expected". He previously said the group, whose businesses include telephones, television sets and cars, expanded too quickly from its video-streaming beginnings 13 years ago.
Jia's resignation is the latest development in a week of turmoil, with asset managers seeking to pull investment after a Shanghai court granted China Merchant Bank'srequest to freeze $182 million in assets due to late interest payments.
"GivenLeEco's current state, in order to protect fund safety, we have asked our fund manager to pause new investment and will seek to hasten our exit from invested projects," Noah Holdings Ltd said in a statement.
Hengyu Tianze, known as 1314 fund, also said it had requested to redeem its convertible bonds in aLeEcounit several times since March and had met with Jia on the matter.
Investors were also spooked on Monday after it emerged that China's national enterprise credit information publicity system showed Jia relinquished his role asLeEco's legal representative last month in favour of another executive, Wu Meng.
"Resigning as chief executive ofLeEco's listed company and many other roles is all aimed at making the FF91 go into production and hit the market as soon as possible," Jia said earlier referring to a luxury electric car thatLeEcois developing with US startup Faraday Future.
Analysts have saidLeEco's foray into automaking caused its financial troubles, but Jia saidLeEco remains committed.
"Our dream to revolutionise the auto industry cannot be defeated, however big a bank run," Jia said, using Chinese characters that mean both 'bank run' and 'jibe'.