Tencent Tech, 10/14/11
Jack Luo, CEO of Beijing-based digital home entertainment company Beijing Eedoo Technology, a subsidiary of Lenovo (0992.HK), said recently that the company will begin limited sales of its iSec gaming console priced at approximately RMB 3,000 in December.
Luo denied earlier reports claiming an exodus of founding employees from Eedoo after the company diluted their shares, a lack of product release dates, and fleeing partners. Of the original seven Lenovo staff who founded Eedoo, six remain at the company, which has grown to 130 employees with a turnover rate under 5%.
Regarding the rumored share value adjustments, Luo said that Eedoo has adopted a variable interest entity (VIE) structure in preparation for an IPO, and that registering the offshore parent company in the Cayman Islands took time. Luo said that early stock incentives offered to employees by the domestic company were calculated in RMB, and the VC requirement that all stock option agreements be redrawn after the establishment of the foreign-invested offshore company resulted in decreased share holdings for all employees.
Luo added that Eedoo has continued to form partnerships with a number of new developers.
Editor's Note: For more information on this topic, please see "Rumor: Employees Flee Game Console Firm Eedoo," MD 10/13/11 issue.