LeTV eyes retail, internet finance sectors
Chinese online video company LeTV is planning an entry into both internet finance and bricks-and-mortar retailing after raising $731.5m (RMB4.5bn) from a pool of investors including CITIC Securities.
CITIC is planning to invest $81.3m (RMB500m) in LeTV as part of a strategic partnership between the two companies, according to a securities filing with the Shenzhen Stock Exchange.
The other investors include LeTV’s parent company, Leshi Internet Information & Technology Corp, Beijing Lancapital Funds Management Co, Ningbo Jiyuan Fund and Beijing Jintai Zhonghe Investment. The investors will acquire 129.5 million of LeTV’s A-shares in a private placement deal at RMB34.76 per share.
One of the few profitable online video sites in China, LeTV looks set to use its new war chest to expand into the internet finance business, as well as build out its bricks-and-mortar presence in mainland China.
Under a partnership programme dubbed LePar, LeTV plans to open 1,000 to 1,500 retail stores across China before the end of 2014.
LeTV vice president Zhang Zhiwei told local media that LePar would be a display and post-sales service platform, which it hopes will reach a broader customer base than its existing retail outlets. The company also hopes to expand its ecommerce and offline retail business, including movies, wine and fresh food.
Meanwhile, CITIC and LeTV plan to jointly explore opportunities in internet finance and the development of financial products, currently a fast-growing area among tech companies in China. Tech giants Baidu, Alibaba and Tencent have all launched investment products over the past year.
LeTV is in the process of retuning its set-top box business after the State Administration of Press, Publication, Radio, Film and Television (SAPPRFT) said it was violating regulations. The Chinese regulator appears to be concerned about uncensored product making its way from computers to TV screens.