A struggling Chinese tech giant looking to make a big splash in the US is said to be selling off property to raise money

pulse

March 17, 2017 8:56 AM

LeEco CEO Jia Yueting once said the company's Silicon Valley property would be "an EcoCity" housing 12,000 employees, but its headcount is nowhere near that.

The LeSee Pro electric concept vehicle by LeEco seen at the 2017 CES in Las Vegas on January 5.

The Chinese tech giant LeEco is looking to sell a 49-acre Silicon Valley property it purchased from Yahoo less than a year ago.

Citing unnamed sources, Reuters reported early Friday that the cash-strapped company was in talks with another China-based firm about a land sale that could top $260 million.

LeEco bought the property from Yahoo in June at about the same time it opened its first US headquarters in San Jose, California.

LeEco's CEO, tech billionaire Jia Yueting, said at the time that the old Yahoo site would be "an EcoCity that houses 12,000 employees."

China's Genzon Group is in the running to buy the LeEco property, Reuters said. A LeEco spokesperson told Business Insider in a statement on Friday that the company is "working on securing a development partner" for the land.

"We are not yet ready to share plans for the land as we are still in the initial planning phase. If you look at other developments of this size in the area, this is multi-year process to get from ideation to reality," the statement read.

The potential sale is the latest wrinkle in what has been a tumultuous run for LeEco. It started as an online entertainment company and expanded dramatically over a decade, selling smartphones and televisions and, more recently, developing electric cars.

Jia said in a letter to employees last fall that LeEco's rapid expansion had dried up its cash reserves. Layoffs have hit LeEco globally, with hundreds of jobs cut at its offices in India and in Hong Kong.

Shares in LeEco's publicly traded flagship, Leshi Internet Information and Technology, dipped 25% in five months, Reuters reported.

LeEco is partnered with the US-based automotive company Faraday Future, a startup that wants to build electric self-driving cars. Jia is Faraday Future's only publicly known investor. Like LeEco, Faraday has also had trouble paying its bills, which have led to lawsuits and executive departures over the past year.

LeEco got a $2.2 billion investment from the property company Sunac China Holdings in January, but that money was earmarked for LeEco's entertainment business and not its languishing car upstarts, which have yet to complete any production-ready vehicles or a factory in which to build them.

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