(Yicai Global) Feb.22 -- A Hong Kong court has liquidated Le Corporation Ltd., a unit of the debt-ridden Chinese tech group LeEco located in the special administrative region, following a petition filed late last year.
Le Corp's total outstanding debt amounted to HKD70 million (USD8.95 million), and the firm has been sued several times in recent years by advertising and service vendors over undue payments totaling HKD70 million, news site Sina Technology reported.
The subsidiary did not send any representatives to the court hearing. Le Corp’s former employees, let go last month, are owed severance pay and salary totaling HKD300,000 and will need to apply for the Protection of Wages on Insolvency Fund themselves.
Leshi Holding Co. Holding set up the unit after establishing its Asia Pacific headquarters in Hong Kong in 2014. The subsidiary was responsible for marketing Leshi TVs, cellphones and other products in cooperation with local telecoms firms, distributors and advertisers. Le Corp started to default on debts from the third quarter of 2016 onward.
Le Corp’s liquidation does not affect LeTV Sports Culture Development Beijing Co., also known as LeSports, Leshi's other unit in Hong Kong said as the pair are independent of each other. LeSports will continue to provide live-streaming services for events such as Premier League soccer matches and NBA games.
Le Corp and LeSports are not part of the infrastructure of LeEco’s listed arm, Leshi Internet Information and Technology Corp., and belong to other related parties.
Leshi Holding Co. founder Jia Yueting resigned from all his positions at the listed unit in July last year. Jia promised to repay all debts and requested more time in a social media post at the time. Despite support from Sunac China Holdings Ltd. Chairman Sun Hongbin, LeEco is still facing a cash crisis. Lenders have repeatedly gone after Leshi in Chinese courts.