LeEco Sells off Sprawling San Jose US Headquarters to a Chinese Developer Group
To pay lease for continuing operations on 49 acre plot.
LeEco has finally sold its sprawling 49-acre campus in San Jose to a Chinese developer firm called Han’s Group. The cash-strapped Chinese internet conglomerate had earlier bought this land from Yahoo and had set up its US headquarters there.
The report by Silicon Valley Business Journal hasn’t revealed the precise financial details of the acquisition. Last year, LeEco had paid Yahoo a whopping $250 million for acquiring this property and it’s very unlikely that the Chinese firm has sold it for anything less. Recently, we had reported that LeEco is in talks to sell off this plot to another Chinese developer called Genzon Group. Industry analysts were then speculating a resale price of $260 million.
With that said, the report claims that LeEco isn’t planning to shift its headquarters to elsewhere post the acquisition by Hans Group. It is, in fact, reported to pay the lease to the Shenzhen-based development company to continue its operation from the San Jose plot.
Currently, San Jose-based US headquarters of LeEco houses around 475 employees across various divisions. The Jia Yueting led company was initially supposed to be building a sprawling Ecocity housing nearly 12,000 employees in a 49-acre plot. LeEco’s dreams were however cut short as the company went into a financial crisis soon after the US expansion and acquisition of a large of companies including US-based TV maker Vizio. Just a few weeks back, it was reported that the acquisition of Vizio had fallen midway due to certain regulatory concerns.
LeEco is now desperately trying to cut down on its running costs. After reducing its staff strength in India by about 85%, the company is mulling to cut down its US work force as well. Reports suggest that LeEco is planning to lay off around 175 of its 475 strong US team. In recent news, Mr Winston Cheng, Global Head of Corporate Finance and Development left the company last week amidst financial turmoil. That aside, in a related development, LeEco recently pulled the plug on its EcoPass video services in US.