After 278 days of trading suspension, LeTV.com finally released a substantive announcement regarding its major restructuring. On January 19, the company decided to terminate the significant asset reorganization and the change of company name and abbreviation, following a review by the board of directors. Although the announcement did not specify when trading would resume, it became clear that there was no longer a valid reason to continue the suspension.
In the evening, LeTV re-released an updated announcement highlighting various risk warnings, including changes in the actual controller, unrecoverable receivables from related parties, tight cash flow, expired debt, declining performance, external investments, and guarantees.
This day had finally arrived.
What signs of a solution were there?
At 6:50 am on December 31, 2017, Jia Yueting’s wife, Gan Wei, posted on Weibo: “On the last day of 2017, my mission will return. At the beginning of the new year of 2018, I will have a long way to go... Good morning, Beijing.â€
On December 25, the Beijing Securities Regulatory Bureau issued a notice ordering Jia Yueting to return to China before December 31, 2017, to fulfill his obligations as the company's actual controller and manage the company's risks while protecting investors’ rights.
On the afternoon of January 7, Gan Wei shared on Weibo that she had resolved some debts through asset offsets and sales. Specifically, she repaid core assets of LeTV Mall for 92.9 million yuan to a subsidiary of LeTV.com, helping repay part of the listed company’s debts. The sale of Coolstock shares also helped repay China Merchants Bank with HK$807 million, achieving a repayment ratio of nearly 60%. The next step was to communicate with China Merchants Bank to unfreeze assets. While this marked a potential turning point for LeTV’s debt issues, the bank did not respond publicly.
Although Jia Yueting could not return home in time, LeTV could no longer justify the trading suspension.
On the first trading day in January 2018, LeTV was removed from the Shenzhen Composite Index, Shenzhen Stock Exchange Index, and GEM Index.
From its large-scale capital pursuit and rising market value to the crisis, business disintegration, and financial breakdown, the LeTV ecosystem built by Jia Yueting followed a sharp upward curve, only to crash dramatically within three years.
The crisis broke out on April 14, 2017, when LeTV suspended trading, citing the acquisition of LeTV Films. Soon after, the company faced a series of crises, including layoffs, financial difficulties, related-party transactions, and cash flow problems during the suspension period.
At a press conference on May 21, Jia Yueting still claimed that the LeTV ecosystem was promising and competitive, calling it the core of the company’s strength. He emphasized that the seven sub-ecosystems—internet technology, content, large screen, mobile phones, automobiles, sports, and finance—were all essential components.
However, despite the ambitious vision, the system eventually collapsed under pressure. As the crisis deepened, the interconnected ecosystems turned into a battleground, with each part struggling to survive. Reports revealed that the music-as-mobile-phone project, led by Sun Hongbin, suffered losses of up to 9.2 billion yuan, becoming a critical blow to LeTV.
On June 26, 2017, China Merchants Bank applied for property preservation, requesting the freezing of over 1.237 billion yuan in bank deposits and other equivalent assets belonging to several LeTV subsidiaries and executives. This marked the full outbreak of the LeTV crisis.
Jia Yueting later admitted that banks had been running on the company, forcing the sale of old shares worth 9.7 billion yuan and even using company funds to repay loans. This led to a more severe liquidity crisis than the one experienced in November 2016.
By July 4, LeTV announced that Jia Yueting’s 26.03% stake in LeTV.net had been frozen due to personal joint guarantees. On July 24, CCB Beijing Guanghua Sub-branch also sought property preservation, requesting the seizure of assets worth 250 million yuan from LeTV and its executives.
In July, Sun Hongbin was appointed chairman of LeTV, stating that the ecosystem could still be managed effectively. However, the reality proved otherwise.
On December 25, the Beijing Court Trial Information Network ruled on a dispute between Huafu Securities and Jia Yueting, marking the sealing of all his domestic assets. There were no more bank deposits or properties available for execution under his name.
As the crisis unfolded, institutional investors and fund managers bore the brunt of the fallout. Since the trading suspension in April 2017, fund valuations dropped sharply, from 15.33 yuan to 3.91 yuan, a 74.5% decline.
LeTV’s top ten shareholders included Central Huijin, gold asset management plans, and even celebrity investors like Zhang Yimou and Sun Yi. With over 186,000 individual shareholders, the impact on retail investors was massive.
Wang Daixin, a vulture fund manager, noted: “If the restructuring fails, retail investors are in a very passive position. Even if they want to sell, they might not be able to. There could be multiple daily halts. Once trading resumes, institutions will be interested in the stock, depending on what prospects LeTV has. No stock is uninteresting, only prices may be.â€
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