Huawei is reportedly in talks with few Chinese companies to sell a part of its sub-brand, Honor. The Chinese giant has been strangled by US sanctions since last year and has lost most of its major contacts to continue in the phone business. Thus, as a part of the restructuring, Huawei might sell some share of Honor to Digital China, Xiaomi or TCL to survive.
Huawei to Sell Parts of Honor
Huawei is one of the top-performing brands worldwide in terms of smartphones and 5G until last year, where it was hit by the US government’s sanctions to lose most of its capabilities. While the company is still a market leader in its birthplace, China, it’s gradually degrading in power.
Adding its name to the Entity List has made a significant dent in its operations. The US government has ordered all associated companies to detach from Huawei. Out of all, Google stopping the Google Play Services and TSMC turning down new orders for chips have impacted severely. Yet, the company tried to survive somehow.
And now, unable to take more, it’s planning to sell a part of stake in its sub-brand, Honor to remain alive. It’s reported by Reuters that Huawei is in talks with Xiaomi, Digital China and TCL for this. While it’s unclear which parts are actually selling, reports say the “Honor’s brand, research & development capabilities, and related supply chain management business.”
This deal would be an all-cash one, bringing an estimated 15 to 25 billion yuan ($2.2 million to $3.7 million) to Huawei’s table. Selling to Digital China seems more reasonable since it’s already handling the whole supply chain of Honor phones. This could even benefit the Honor in a large way since it could slip from the US’s radar.
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