New Delhi, Aug.8 (ANI
): Internet and technology conglomerate LeEco announced that its Founder, Chairman and Chief Executive Officer Jia Yueting has become the Chairman of the Board and the Nominating Committee of the leading smartphone maker Coolpad on August 5th. This is after LeEco turned into the largest shareholder of Coolpad on June 17th, with a total of 28.9 percent stake of Coolpad.
With strong technology capacity and wide user base from Coolpad, LeEco is set to further revolutionize the smartphone market with its unique "ecosystem" business model, where multiple products and services ranging from smartphone to electric car are interconnected.
On Monday (August 8th), Coolpad's stock price spiked over 20% compared with that of August 5th, thanks to the news.
LeEco's Founder, Chairman and Chief Executive Officer Mr. Jia Yueting
"LeEco+Coolpad" is expected be the black horse of the saturated global smartphone market this year with an estimated sales of 50 to 60 million units, becoming one of the top four players in the industry in China among companies such as Huawei, OPPO and Xiaomi. It plans to become the NO.1 smartphone supplier in 2017 with an annual sales of 100 million handsets. Both brands have strong presence in India where Coolpad is already a household name in smartphone and LeEco is welcomed for its smartphone and smart TV products as well as its heavy investments in the country," said Yueting.
This move came after LeEco bought 11 percent share of Coolpad with HK$1.047 billion (US$135 million) in June this year in addition to a HK$2.74 billion (US$353 million) purchase of 17.9 percent shares last June. With a total of 28.9 percent stake in Coolpad, LeEco has become the sole controlling shareholder of the company.
Jia said LeEco and Coolpad will adopt a dual-brand strategy, where the two brands co-exist and target at different market segments. The two will also collaborate extensively in resources sharing, business development as well as technology research. The dual-brand strategy will be applicable to LeEco and VIZIO as well for the development of TV ecosystem, following the US$2 billion acquisition of the pioneering American TV manufacturer on July 26th.
Coolpad's technologies and patents will speed up LeEco's global expansion while LeEco's ecosystem of "platform, content, hardware and application" will be available to existing Coolpad users that are as many as 100 million.
Since its entrance into smartphone market last April, LeEco redefined the industry with its ecosystem business model that incorporate multiple devices, rich content library and varied internet services. It has sold more than 2.3 million units of Superphones in China this June, increased by 0.3 million from the previous month. It has also sold 700,000 units after its expansion to the Indian market six months ago, achieving multiple records in the industry in India.
Jia took over after the stepping down of Guo Deying, the founder of Coolpad who led the company to become a leading smartphone brand. Coolpad was once the No.2 in market share in China and has built a strong arsenal of technologies and patents.
The first product of the collaboration will be a new handset designed for the youth generation and will be announced on August 16th in Beijing. (ANI