LeE.com subsidiary LeEZhixin increased capital and expanded shares, Truly International invested 720 million yuan, holding 2.3%

Letv's announcement last night showed that in order to enhance its operating strength and meet the capital demand, the holding subsidiary Letv made a new decision to increase its capital and shares. Xinli Electronics, a company owned by Xinli International, contributed 720 million yuan to subscribe for an additional 7.4989 million yuan of registered capital. upon completion of the transaction, Xinli Electronics will hold 2.3438% of Letv Zhixin's equity.

the original title Letv started two rounds of tonifying blood: Xinli International bought 720 million shares in Letv, which led to the transformation of new creditors.

one month after the financing of "marriage", Letv started a "new relationship" again: it was announced on the evening of February 14th that Letv had introduced Xinli International into Hong Kong stocks as a strategic investor. Prior to this, Xinli International was an important supplier to Letv Ecology.

Letv's announcement last night showed that in order to enhance its operating strength and meet the capital demand, the holding subsidiary Letv decided to increase its capital and shares. Xinli Electronics, a company owned by Xinli International, contributed 720 million yuan to subscribe for the additional 7.4989 million yuan of registered capital. upon completion of the transaction, Xinli Electronics will hold 2.3438% of Letv Zhixin's equity.

in fact, this is Letv's second "blood transfusion" in solving the problems of "capital chain" and "supply chain". On January 14, Letv introduced Rongchuang and other parties in high profile as its ecological strategic investors, with a total investment of more than 16.8 billion yuan. Among them, Leran Investment, Huaxia Life Insurance and Fuchui Huixin invested 1.43 billion yuan, 400 million yuan and 7.95 billion yuan respectively to invest in Letv.

because Jiarui Huixin acquired a 33.5% stake in Letv Zhixin through the deal, Letv's post-investment valuation was 23.73 billion yuan.

this time, Xinli Electronics spent 720 million yuan to acquire a 2.3438% stake in Letv Zhixin, equivalent to a valuation of 30.72 billion yuan after Letv's new investment. This means that Letv's new valuation has increased by about 29.46 per cent in just one month.

however, in the eyes of industry insiders, the introduction of Xinli International is not the same as the introduction of financing-Letv's new round of financing may be a "debt-to-equity swap".

before that, Letv was exposed that he was in arrears with suppliers, while Xinli International was one of the suppliers owed, and Letv once put forward repayment plans such as "installment payment" and "debt-to-equity swap". It is also understood that in November 2016, Letv began to pay arrears to suppliers, but did not continue to implement the "installment repayment" plan, and some distributors even helplessly made huge amounts of bad debts.

according to people familiar with the matter, Xinli International is Letv's main supplier of touch screens and touch modules. Letv once owed 1 billion yuan to him, but considering that there has been partial repayment since then, the actual amount owed may be in the hundreds of millions of yuan, which is close to the amount of Xinli Electronics's stake this time.

the insider further said that Xinli's shift from a supply chain creditor to a "strategic investor" may be due to the effectiveness of Letv's previous "debt-to-equity swap" plan. In the future, if Letv does not continue to implement the "installment repayment" plan, it does not rule out the possibility that more suppliers will accept the "debt-to-equity" plan and become one of the shareholders of Letv Ecology.

other market participants believe that compared with Xinli International and the new valuation level caused by the acquisition of shares in Letv, it is not difficult to find that this is not a "too bad" result for Letv itself. when the timetable has been clearly injected into the listed company (according to the investment agreement, Letv issued a new commitment to inject non-Leeco shareholding into Leeco, and complete the declaration to the CSRC by December 31, 2019) The introduction of industrial chain suppliers as strategic investors can also pave the way for subsequent securitization.

Edit: nancy