Jia Yueting, co-founder of struggling Chinese content and devices company LeEco (pictured), resigned as chairman at an extraordinary shareholder meeting, which ended without the election of a new chairman.
LeEco’s listed unit, Leshi Internet Information & Technology, called the meeting to approve the appointments of Sun Hongbin, Liang Jun and Zhang Zhao as non-independent directors.
Amid protests from creditors, no replacement for Jia was named at the meeting on Monday, Reuters reported, adding about two dozen people protested outside the meeting venue in Beijing.
However, Sun, the chairman of real-estate developer Sunac China Holding, is expected to be named LeEco’s chairman at a meeting scheduled for Thursday, Financial Times said. The property developer in January provided a cash infusion in exchange for stakes in LeEco’s core film and television streaming units.
After the company’s troubles mounted over the past six months, Jia resigned in late May as CEO of cash-strapped LeEco, but remained the company’s chairman.
In early July a Shanghai court froze the personal assets of Jia and his wife Gan Wei. The court ruling follows the once fast-rising company’s failure to pay interest due on loans taken out to fund its ambitious expansion into smartphones.
To raise funds to paid off debt, LeEco announced in January it would sell off minority stakes in three of its businesses to Sunac to raise CNY15.04 billion ($2.2 billion). Other Chinese investors will contribute an additional CNY1.8 billion, raising LeEco’s funding to CNY16.8 billion.
Jia acknowledged in November 2016 the company, which moved aggressively into smartphones, smart TVs and electric cars, was expanding “too fast” and its capital and resources were not keeping pace. A month later LeEco said it was planning to restructure its business following the suspension of trading of its shares on the Shenzhen Exchange.
LeEco, often referred to as the Netflix of China, abandoned a planned $2 billion acquisition of US consumer electronics maker Vizio in April due to “regulatory headwinds”, as it fell short of a $100 million revenue goal in the US.