LeTV and subsidiary borrow US$270 Mln to survive debt crisis
As guarantor, LeTV must also pledge its 100% stake in the Chongqing Leshi loan, 100% of Huoerguosi Leshi New Generation and 6.47% of LeSports
Le.com, also known as LeTV, said in an announcement on Monday that the company and its subsidiary, Leshi Zhixin, a television manufacturer, have borrowed 1.79 billion yuan (US$270 million) from Tianjin Jiarui, Caixin reported.
Tianjin Jiarui, a subsidiary of real estate developer Sunac China, is the second largest shareholder of Leshi Zhixin, holding a 33.5% stake.
It loaned 500 million yuan to Leshi Zhixin on the condition that the company pledge its 100% stake in Leshi Investment, equivalent to a guaranteed sum of 500 million yuan.
As guarantor, LeTV must also pledge its 100% stake in the Chongqing Leshi loan, 100% of Huoerguosi Leshi New Generation and 6.47% of LeSports to Tianjin Jiarui, equivalent to 200 million yuan.
The Shenzhen Stock Exchange, however, has sent out an inquiry that if Leshi Zhixin fails to repay the loan, pledgees can exercise their right of guaranty, and Le.com, as guarantor of Leshi Zhixin, could become a hollowed listed company.