Huawei Sells Off Honor To Ensure Latter’s “Survival”
Huawei has announced that it is selling off its Honor smartphone brand, acknowledging “tremendous pressure” on its consumer business and parts unavailability as contributing factors.
“This move has been made by Honor's industry chain to ensure its own survival,” the company said in a statement. “Over 30 agents and dealers of the Honor brand first proposed this acquisition.”
A company called Shenzhen Zhixin New Information Technology Co., Ltd will make the purchase. The sum involved in the deal was not revealed.
According to Reuters, the consortium that is buying Honor includes Nanjing-headquartered electronics retailer Suning.com and state-owned investment firms. It also reported that Huawei is focusing on “high-end handsets and corporate-oriented business” due to restrictions imposed by the U.S. government.
With the sale, Huawei will no longer own any shares in Honor nor be involved in its business management and decision-making. On Honor’s success, the statement said, “During these past seven years, Honor has developed into a smartphone brand that ships over 70 million units annually”.
Huawei is currently the target of U.S. restrictions that “strategically target Huawei’s acquisition of semiconductors that are the direct product of certain U.S. software and technology”. Qualcomm recently obtained approval to sell 4G chips to Huawei, but the Chinese company has begun planning for its own chip-making plant as well.