LOS ANGELES _ Electronics giant Vizio Inc. has been foiled by the Chinese economy again.
The company announced Monday that it has scuttled a proposed $2 billion acquisition by Chinese technology company LeEco. Vizio cited "regulatory headwinds," including increased scrutiny from the Chinese government on cash outflows. The acquisition had yet to receive approval from Chinese officials.
The deal, which had sprouted from discussions early last year, emerged after Vizio halted plans for an initial public offering. The company, headquartered outside Los Angeles, decided not to go forward because concerns about China's economic growth had created instability in the stock market.
Vizio said Monday that though the sale isn't happening, it reached a partnership agreement that will lead to technology collaboration with LeEco. But the company declined to specify financial components and rejected requests to interview executives.
The company had been considering an IPO or acquisition to give employees and manufacturing partners a chance to cash out their stock. What alternative the company might pursue now is unclear.
LeEco's troubles are far from behind it. The company has faced scrutiny from both U.S. and Chinese officials over its finances. Questions still loom about whether the company and its billionaire founder Jia Yueting are overextended with both debt and wide-ranging ambitions. Yueting is also behind the electric car company Faraday Future.
