China's LeEco Collapse Clouds Future for Exec Adam Goodman
The former Paramount president's Chinese venture stalls as its parent company collapses under mountain of debt.
When former Paramount Pictures president Adam Goodman made the splashy announcement last fall that he was selling his production company Dichotomy Creative Group to Chinese film studio Le Vision Entertainment, he said: “We’re not launching a company that is funded by a Chinese business, but a Chinese movie studio right here in Los Angeles.”
The timing of Goodman’s deal wasn’t great, arriving as it did just before Matt Damon’s The Great Wall, co-produced by Le Vision, Legendary East and Universal, flopped spectacularly, and the Chinese studio’s parent company, LeEco, began to slowly implode. Founded in 2004 by Chinese entrepreneur Jia Yueting, LeEco began as a streaming video service, now named Leshi Internet Information & Technology Corp., that was once dubbed the “Netflix of China.”
Having burnt through billions, Jia has since seen Chinese courts seize hundreds of millions of his personal assets. In late July, one of the co-founders of Tencent, Asia’s most valuable company, publicly derided LeEco as “obviously a Ponzi scheme.”
So where does this leave Goodman? Sources with knowledge of the situation tell The Hollywood Reporter that he was paid handsomely upfront for Dichotomy — a coup, considering how he was known to have been shopping the outfit around Beijing for some time.
But whether Le Vision has capital to finance anything will depend entirely on the machinations currently underway in Beijing.
With deputy Liang Jun left as acting CEO, LeEco is now trying to reorganize its remaining assets by merging Le Vision with the publicly traded Leshi to forestall a total plummet in share prices.
But will China’s notoriously strict regulators allow this? The numbers aren’t encouraging: In July, Leshi estimated losses of just under $100 million for the first half of 2017, compared to profits of about $42 million during the same period a year ago. It doesn’t look like Goodman will be bankrolling.
A version of this story first appeared in the Aug. 2 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.