Coolpad Group (2369.HK) recently announced that its three subsidiaries have recently been sued by Ping An Bank’s (000001.SZ) branch in Shenzhen City, as reported by Cnstock.
Ping An Bank has asked Coolpad to pay off an overdue debt of RMB 80 million.
Why It Matters:
- Defendants include the borrower of the RMB 80 million debt, Yulong Computer Telecommunication Scientific (Shenzhen) Co., Ltd., which is a fully-owned subsidiary of Coolpad, and also the guarantors of the debt, including two other subsidiaries under Coolpad.
- LeEco, which recently experienced a cash crisis, is Coolpad’s largest shareholder. In 2015, LeEco acquired a 17.9% stake in Coolpad for RMB 2.18 billion and in 2016, LeEco acquired an additional 11% stake for RMB 900 million and became Coolpad’s largest shareholder.
- As SGI reported earlier, Leshi Internet Information & Technology Corp. (300104.SZ), the publicly traded unit under LeEco, owes 12 Chinese banks RMB 2.24 billion, and the LeEco Group and its other units owe additional money to Chinese banks.