LeEco calls off Vizio acquisition, cites “regulatory headwinds” as cause

We’ve just received word that LeEco has called off its plans to purchase Vizio for $2 billion.

Months after announcing a deal was in place last summer, LeEco reached out to Talk Android today in order to reveal that Vizio will not become a subsidiary. The two companies will continue on their own paths as separate entities; however, a partnership between them has already been forged. It’ll give them access to technologies owned by the other.

Here’s the official statement from LeEco:

“LeEco Global Group Ltd. and VIZIO Inc. announced today that the merger agreement to acquire VIZIO will not proceed due to regulatory headwinds. We continue to believe that there is great synergy between the two companies, and are pleased to announce that LeEco and VIZIO have reached an agreement that is a win for both companies.

Under the new agreement, LeEco and VIZIO will continue to incorporate the Le app and content within the VIZIO connected CE platform, and engage in a collaborative partnership to leverage LeEco’s EUI (Ecosystem User Interface) platform, along with the brands exclusive content and distribution channels, to bring VIZIO products to the China market.”

While citing problems ahead with regulators, it’s likely LeEco’s questionable financial situation impacted its decision to not pull the trigger on buying Vizio. The company was said to be burning through cash upon entering the United States in 2016, so it started seeking a massive investment deal to avoid going broke. And just a few weeks ago LeEco unloaded its Silicon Valley headquarters for $260 million.

It’s wise for the Vizio acquisition to not happen at this time considering all of those reports.

About the Author: Justin Herrick

Born and raised in New Jersey, Justin is a graduate of Fairleigh Dickinson University where he studied marketing with a focus on digital marketing. He's very talkative and enjoys discussing anything from technology and sports to video games and television. As for Justin's current device rotation, he carries around the Google Pixel and Nexus 9. In the rare case that his phone or tablet is not in his hand, he is either flicking through cards on his Moto 360 (2015) or typing away on the Microsoft Surface Book. Justin is patiently waiting for the day that Google replicates the Galaxy Nexus with modern day specifications.