×
You will be redirected back to your article in seconds

LeEco Backs Out of $2 Billion Vizio Acquisition

Chinese online video and consumer electronics upstart LeEco won’t be acquiring U.S. TV manufacturer Vizio after all: Both companies officially announced Monday that the deal is being called off “due to regulatory headwinds.”

Both companies said that they still intend to work together in some capacity, with plans including an app partnership as well as closer collaboration in China. A LeEco spokesperson also told Variety that calling off the acquisition won’t have any impact on LeEco’s other U.S. businesses.

LeEco had officially announced plans to acquire Vizio for $2 billion in cash last July as a way to kickstart its expansion into North America. However, the deal had yet to be approved by Chinese regulators, and sources indicated in recent months that LeEco was affected by tighter regulations to get Chinese capital out of the country.

Both companies could still benefit from a closer collaboration, provided that the willingness to work together actually still exists beyond Monday’s news release: LeEco is trying to get video publishers to be part of its EcoPass subscription service, and having access to an existing footprint of millions of smart TVs would give it a lot more leverage in those discussions. Conversely, Vizio hasn’t had much of a footprint in China, and LeEco could potentially help the company to sell its TVs to Chinese consumers.

Vizio and LeEco suggested as much in Monday’s statement: “Under the new agreement, LeEco and VIZIO will continue to explore opportunities to incorporate the Le app and content within the VIZIO connected CE platform, and engage in a collaborative partnership to leverage LeEco’s EUI (Ecosystem User Interface) platform, along with the brand’s exclusive content and distribution channels, to bring VIZIO products to the China market.”

LeEco’s ambitious U.S. expansion plans have been under scrutiny for some time. Just last month, reports surfaced that the company’s plans to build a huge office complex on a property formerly owned by Yahoo may have been called off as well. LeEco originally intended to build office space for 12,000 employees on a 49-acre property it acquired from Yahoo in 2016. But in March, Reuters reported that LeEco is looking to sell the property again.

The big question is what Vizio is going to do now. The deal with LeEco came together mere months after Vizio had filed for an initial public offering. With LeEco backing out of its acquisition, Vizio could theoretically look for another acquirer, or even once again get ready for an IPO.

However, a source close to the TV maker’s senior leadership recently told Variety that Vizio wasn’t rushing to go public any time soon if the LeEco deal were to fall through. The struggles of hardware makers like GoPro dissuaded Vizio’s leadership from that route, this source said. Instead, Vizio may just opt to operate as is. The source also said that Vizio’s leadership had lost confidence in the LeEco acquisition going through months ago.

 

More Biz

  • IWC Schaffhausen store opening, Rodeo Drive,

    8 Luxury Gifts That Industry Leaders Are Spending Their Paychecks On

    Whether you’re celebrating a new launch, a new business venture, or toasting to the end of another successful year, here are eight gift ideas to reward yourself — and to impress the company you keep. 1. Saint Laurent Perforated Leather Tote Bag If you work in the industry, you need a good bag, and you’ve [...]

  • best airlines ranked inflight entertainment

    Holiday Travel Survey Reveals Airlines With Best In-Flight Entertainment

    There are many ways to pass the time if you’re in the air, but for most people, settling in with a glass of wine and a movie is the preferred way to fly. But not all airlines share the same script when it comes to entertainment offerings. A new survey from the website, CableTV.com, ranked [...]

  • Ventana Sur Rocks with Sales, Mass

    Ventana Sur Rocks with Sales, Mass Attendance, Structural Growth

    BUENOS AIRES — Celebrating its 10th anniversary with a huge hike in attendance to over 4,000 accredited delegates, the 2018 Ventana Sur will go down in history on multiple counts: Sales and pick-ups on movies which combined social comment and entertainment value, increasingly the new foreign-language movie standard; new sections, led by a Proyecta co-production [...]

  • Jennifer Lawrence Harvey Weinstein

    Jennifer Lawrence Denies Harvey Weinstein's Claim in Latest Assault Lawsuit

    Harvey Weinstein was hit with a lawsuit Friday from an actress who claims he forcibly performed oral sex on her, repeatedly masturbated in front of her, and threatened to harm her career if she objected. The suit details that Weinstein claimed he was trying to help her and that he was the gateway to her dreams. [...]

  • Times Up Hollywood

    Time's Up Entertainment Announces New Industry Mentoring Initiative

    Time’s Up Entertainment, an affiliate of the Time’s Up coalition of women across industries working to improve workplace safety, has announced the “Who’s in the Room” industry mentoring initiative. The program’s goal is to increase the presence of people of color from diverse backgrounds in the entertainment industry’s executive ranks. Funded by a $500,000 grant from [...]

  • Tom Cruise as Ethan Hunt in

    Paramount Inks Deal for Theme Park in South Korea

    Paramount Pictures has announced a deal to install a studio-branded theme park in an entertainment resort being developed in South Korea. The agreement was struck between Paramount and Mohegan Gaming & Entertainment, which owns the Inspire Integrated Entertainment Resort in the South Korean city of Incheon. Mohegan has invested KRW 2.8 trillion ($2.4 billion) in [...]

  • Davan Maharaj Mel Gibson

    L.A. Times Publisher's Lawyer Was Accused of Extorting Mel Gibson

    The attorney who negotiated a $2.5 million exit package for L.A. Times publisher Davan Maharaj was previously accused of using secret recordings to extort actor Mel Gibson. Surreptitious recordings also figure in the Maharaj case. NPR reported on Wednesday that Maharaj taped Tronc chairman Michael Ferro. According to the report, Ferro was heard on the [...]

More From Our Brands

Access exclusive content