Le Sports completes 2nd round of funding, valued at 21.5b yuan

A Le Sports stand at a golf merchandise expo in Beijing. [Photo/China Daily]

Latest cash injection of $1.23 billion puts company on way to building sports 'ecosystem'

Internet-based company Le Sports has completed a second round of financing, worth 8 billion yuan ($1.23 billion), which analysts said gives it a significant edge over rivals.

Jia Yueting, CEO and chairman of parent company LeEco Holdings Ltd, said on Sunday its sporting offshoot is now valued at 21.5 billion yuan.

The latest cash injection means Le Sports' investors include HNA Capital Group Co, the investment unit of Chinese airline giant HNA Group Co Ltd, and a number of individual investors such as Sun Honglei, a famous actor in China.

Jia said the latest round was "recognition of our broad plan to build an ecosystem, which spans sports, video streaming, electric vehicles and smartphones", adding the company continues to integrate resources from various industries.

No details were given on how the latest investment might affect LeEco's majority ownership of Le Sports, but the firm added in a statement the new cash will be used to enrich its sports-related online content, and develop new smart equipment to meet people's growing desire to stay fit.

Le Sports, which became an independent unit from LeEco's video-streaming service two years ago, is one of the fastest-growing companies in China's sports sector.

In May, it raised 800 million yuan from investors including Wanda Investment Co.

Its second funding round comes as Chinese Internet heavyweights are rushing to branch into the sports sector, an industry that is winning favorable policies from the central government.

Alibaba Group Holding Ltd and Tencent Holdings Ltd, for instance, are both expanding their presence through investment and partnerships.

Jiang Qian, an analyst at Beijing-based Internet consultancy Analysys International, said the deal demonstrated investor confidence in Le Sports.

"Le Sports has won exclusive online broadcasting rights to a series of top-tier competitions in recent years, which is a strong proof of the company's marketing and organizing capabilities," Jiang said.

In February, Le Sports spent 2.7 billion yuan on becoming the exclusive online broadcasting partner of Chinese Super League, the country's top soccer event, after winning the broadcasting rights of the English Premier League and the National Football League in the United States.

"Its abundant sports content is the biggest advantage of Le Sports, from which the company can build a sizable user base and offer other services such as selling sports game tickets and lotteries," Jiang said.