Budget smartphones. Networking giant Huawei is reportedly close to selling its Honor smartphone unit to a number of Chinese buyers
Honor, the Western-focused smartphone brand from Huawei, is to be sold off for $15 billion to a number of China buyers, it has been reported.
According to Reuters, which cited people familiar with the matter, Huawei plans to sell budget-brand smartphone unit Honor in a 100 billion yuan ($15.2 billion) deal to a consortium led by handset distributor Digital China and the government of its home town of Shenzhen.
It should be remembered that Shenzhen-based Huawei also makes its own smartphones, under its own brand and the Honor moniker.
Huawei is currently the second largest smartphone maker in the world, behind market leader Samsung Electronics.
The people told Reuters that Huawei has reached the decision to sell the Honor unit because it will allow it to focus on high-end handsets and corporate-oriented business.
And interestingly, the decision also reflects Huawei’s thinking that even with a new US administration on the way in the New York, there is little expectation that the United States will change its view of Huawei as a national security rik.
According to the Reuters report, the all-cash sale will include almost all assets including brand, research & development capabilities and supply chain management.
Huawei could announce it as early as Sunday, one of the people told Reuters.
The sale of Honor will reported sell main Honor distributor Digital China Group Co Ltd acquiring a near-15 percent stake in the unit.
Digital China will be joined by at least three investment firms backed by the local Chinese government of Shenzhen, with each owning 10 to 15 percent, they said.
After the sale, Honor plans to retain most of its management team and 7,000-plus workforce and go public within three years, the people told Reuters.
Honor declined to comment on the report.
Huawei, Digital China and the Shenzhen government likewise did not immediately respond to requests for comment.
Honor was created by Huawei back in 2013, but it is reported that it operates independently from Huawei.
By selling off Honor, the unit will no longer be subjected to US sanctions against Huawei, the people told Reuters.