Chinese mobile brand G It has declared bankruptcy and has entered a liquidation period after confirming that the coffers are full of cobwebs. The reason for this disaster is found neither more nor less than its CEO, Liu Lirong, who has been accused of appropriating the company's funds to spend it on bets.
A brand that had 5% of the market in China
The case of G It was as striking as that of other Chinese companies, which with good products have been monopolizing the market until achieving a more than reasonable global expansion. With a 5% market share in China, the brand was comfortable, and its global progression started on the right foot, distributing its mobiles all over the world. Among its most outstanding models were some with thicknesses that were presumed to be the thinnest in the world, or others with batteries that were almost endless 7.000 mAh.
Many of its star models stand out for incorporating quite daring functions, and although the price was not very good, it has been the more modest models that have managed to attract a certain sector of the market, although not enough to continue ascending positions, since the The brand focused especially on high-end models with a certain touch of luxury.
Too many debts to continue with the activity
After several years accumulating losses of up to 14,4 million dollars a month, the company opened an investigation to find the problem, and that's when all suspicions pointed to the company's CEO. The manager has been accused of spend $144 million on a casino bet, but Liu Lirong assures that he has not used company funds for his enjoyment, acknowledging that he did "borrow some funds from the company." That certainly doesn't help his defense too much.
After completing all the investigations, a Shenzhen court has confirmed Gionee's bankruptcy status, alleging that the company owes more than 3.000 million euros between loans to banks, payments to suppliers and advertising agencies. Although the situation is critical, for now the closure of the company cannot be confirmed, since, although it is in the liquidation period, a group of consultants is working to redirect the trajectory and, incidentally, restructure the company. Liu Lirong himself assures that the company could return to profitability in a period of 3 to 5 years, but something tells us that his words could not be too reliable.