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What's wrong with Jia Yueting's frozen assets

4hw.org: LETV has a lot of problems this year. First, it was revealed that it still owes money, then it broke the capital chain. Now, Jia Yueting and his wife's assets have been frozen. Many of them are surprised. What's wrong with LETV? Let's have a look!

Another problem occurred with Jia Yueting and his leeco empire. Last week, the 1.237 billion assets of three leeco companies and Jia Yueting and his wife were legally frozen. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

According to several domestic media reports, a document issued by Shanghai Higher People's Court on June 26, 2017 shows that China Merchants Bank Co., Ltd. Shanghai Chuanbei sub branch applied to Shanghai Higher People's court for property preservation on June 26, 2017, which was ruled by the court to be in line with the law.

The court's specific ruling content is: freezing the bank deposits under the names of Lefeng Mobile Hong Kong Co., Ltd., LETV mobile intelligent information technology (Beijing) Co., Ltd., LETV Holdings (Beijing) Co., Ltd., Jia Yueting and Gan Wei totaling 1.237 billion yuan, or sealing up or detaining other equivalent properties.

China Merchants Bank, which has applied for property preservation, had close cooperation with LETV. According to China economic network, in November 2015, LETV holdings and China Merchants Bank Shanghai branch held a strategic cooperation ceremony. The two sides will reach long-term strategic cooperation in comprehensive credit, cash management, financial consulting, international business and other aspects. Among them, China Merchants Bank Shanghai Branch will provide 10 billion yuan strategic global comprehensive credit line to LETV holdings and its subsidiaries to meet the capital demand of LETV's domestic and foreign businesses.

Pintu Business Review consulted LETV holdings on this matter, and the response of LETV holdings is unclear. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

When communicating with investors last week, Jia Yueting said that it's a wrong way to let the business raise money by itself when there is a shortage of funds. What should be done is to actively communicate with financial institutions, use the very valuable 9 billion yuan to the business, and quickly restore the business to normal, or even better development. This is the fundamental solution to the risk of financial institutions.

Jia Yueting pointed out that when he found this problem, he began to adjust his strategy, actively communicated with financial institutions, hoped to provide secondary support to LETV, and hoped that there would be a better arrangement for the approval process of credit funds.

Then China Merchants Bank made a move.

The second crisis of LETV mobile phone

Of the three companies involved in LETV, two are related to LETV mobile phones. And leeco mobile phone is also one of the fuse of leeco's capital chain. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

LETV mobile intelligent information technology (Beijing) Co., Ltd. was founded in 2014. Its legal representative is Jia Yuemin, Jia Yueting's elder brother, with a registered capital of 20 million yuan. Its main business is LETV mobile phone Lefeng Mobile Hong Kong Co., Ltd. holds 100% equity of LETV mobile through LETV mobile technology (Beijing) Co., Ltd.

Upon inquiry, the three companies have no abnormal business information. On June 13, the legal representative of LETV holdings, the parent company of LETV's unlisted company system, was changed from Jia Yueting to Wu Meng, the supervisor of LETV.

Leeco mobile is considered to be the beginning of the outbreak of leeco's capital chain problems. At the end of 2016, Jia Yueting issued an internal letter to all staff, saying that the current shortage of funds is still concentrated on mobile phones, mainly the problem of the mobile phone supply chain, and reflected on the lack of funds caused by the fast pace of the company, and announced to stop the expansion of burning money.

According to incomplete statistics, LETV mobile phones have affected dozens of suppliers and agents, and the scale of debt is billions of yuan.

The capital chain problem of LETV mobile phone also affects other mobile phone brands in the upstream and downstream of the industrial chain. Huawei conducts research to various suppliers to confirm whether they supply goods to LETV to prevent involvement in right and wrong.

Some analysts told Pinto business review that LETV mobile phones are sold at a price lower than the market share, and the inclined sales strategy of buying members to send hardware is the reason for the problem of capital chain. LETV's 1s mobile phone sold a hard loss of 200 yuan, which makes the cash flow of sales unable to fully cover its cost, so it is difficult to avoid the debt of upstream supply chain. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

Until the news of asset freeze was released, there was no negative news on LETV mobile phone, but because of the loss of "money burning expansion", LETV mobile phone gradually faded out of people's vision.

LETV's ecological dream is unsustainable

'since October, we have taken a lot of measures and made some mistakes. On the contrary, the funds of LETV's unlisted company system are more tense than when the crisis just broke out. This is the problem we have found in two or three months. Originally, more than 9 billion yuan would have come into the unlisted system. Theoretically, it should be able to completely solve the problem of capital. Obviously, the result did not meet our expectations. '

Jia Yueting revealed in an exchange with investors on June 28 that the fund gap of LETV's unlisted company system is very large, and 9 billion yuan is still not enough. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

A typical example is easy to get. Zhou wrote in April this year that LETV misappropriated 1.3 billion yuan of easy to get funds, which resulted in insufficient turnover of easy to get funds and drivers unable to withdraw cash. Later, leeco and e-to jointly stated that leeco had never misappropriated any funds from e-to, including user recharge, and had invested nearly 4 billion yuan and a large number of ecological resources to support e-to-development.

However, it is undeniable that it is difficult to solve the problem of cash withdrawal from drivers. Until recently, Yidao stated that LETV was no longer the controlling shareholder, and LETV had obtained 350 million yuan from a trust company for "ammunition replenishment" to Yidao, and the cash withdrawal at the driver's app end had also returned to normal.

'sell when you need to. 'sun Hongbin has talked about his attitude to LETV more than once in public, and Yi Dao is the first test product.

Also in crisis is LETV sports. After the withdrawal of investors and the abandonment of the game copyright, LETV sports announced that it had obtained a new round of financing with a valuation of 24 billion yuan and started to establish an ecological town in Ningbo. This also means that Le ti is gradually adjusting its strategy.

After rongchuang became a shareholder of LETV, sun Hongbin didn't show any favor to LETV sports, saying that the super sports of LETV sports is neuropathy. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

After the completion of B + round financing, LETV sports did not seem to get out of the dilemma completely. One supplier revealed that LETV sports had paid only once in arrears in 2016, with several hundred thousand yuan in arrears.

"Hundreds of thousands are a headache for small companies," said the source. The company provides promotion and packaging services for LETV sports events, but the 'cooperation process has not been smooth'. The most important reason is the arrears. When there is no way to go, we have to go through legal procedures. However, two courts have been held, and LETV sports still prevaricates the past with reasons, so far there is no formal trial.

Online transfer to LETV's suppliers for Dunning

It is understood that LETV sports has arrears in sports events, VR and other aspects, even including the Chinese Football Association. In addition to several big suppliers that have been announced, there are countless small ones.

The person has applied to the court for property preservation, as China Merchants did.

'I've been in touch with LETV employees, and I don't like this company very much. The corporate culture is too impetuous. '

When I sent this sentence to a former employee of LETV sports, he immediately refuted: 'the corporate culture is completely OK, and the internal collaborative work is very smooth. (leeco) the money for sports is given to cars, which is impossible. '

The LETV empire is about to collapse?

'I can understand many things about leeco better than Lao Jia. "After rongchuang invested 15 billion yuan in LETV, sun Hongbin spoke surprisingly.

Due diligence lasted for more than a month, sun Hongbin summed up the cause of LETV crisis: lack of money. So the first logic of investing in LETV is to make it rich.

Lack of money is certainly one of the reasons why the LETV crisis broke out. In addition, there are many things worth exploring in this company.

1. ecology

When LETV imposes the hat of ecology on its head, its road is doomed to be rough. In just a few years, LETV has developed television, mobile phones, movies, bicycles and even cars, trying to stutter fat people and support each other to become giants. In the eyes of ordinary people, it seems that wechat just announced to build a car when it had the function of friend circle. Some related people told Pinto business review that LETV's initial booth was too large and operated independently, which could not form interest relationship at all, let alone ecology. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

2. Business model is blocked

The logic of LETV's hardware release is simple: hardware will be free in the future, and content will continue to be profitable and accepted by the public.

In the era of intelligent hardware everywhere, this mode is favored by many people, but with the decline of concept and the failure of business model, people who have said this sentence before have been 'slapped', which is the case with Zhou Hongyi.

LETV's ecology has always been implementing this point, using the "terminal + content" business model to constantly brainwash and marketing. In the ecosystem of leeco, the content of leeco video and leeco video industry is the foundation of making money.

With the competition of bat, the copyright of video content will become more and more expensive, and the industry position of LETV may not be able to support for a long time. On this basis, the ideal of terminal + content can only be a story.

3. Related party transactions

Some people even suspect that leeco's use of funds is another Ponzi scheme. Media reports say that almost all of LETV's ecosystems are engaged in connected transactions with LETV. There is no doubt that there is no complete separation between LETV's ecosystems, including unlisted systems, and LETV's cars. But it's not transparent. (this article is edited and collated by sihai.com, reprinted and noted with source, original link: http://www.4hw.com.cn/life/)

"Today, LETV has called almost all the multi-level capital markets that can be called, including secondary market, bond market, new third board, PE, VC, bank, and even once tried to intervene in peer-to-peer, making its own financial control & hellip; & hellip; wherever there is' more money ', LETV will be seen. '

Jia Yueting's misappropriation of funds' left hand to right hand 'seems to have become a fact that does not need to be proved, and a steady stream of real money and silver has flowed into the listed company system and the automobile system. However, when sun Hongbin came to the rescue, Jia Yueting himself was not free to misappropriate funds, only to manage the car system at ease.