According to a report from Reuters, Huawei planning to sell its sister smartphone brand – Honor smartphone division for 100 billion yuan ($15.2 billion) to a handset distributor, Digital China, and the government of Shenzhen, reveals people familiar with the matter.
Last year, Huawei was added to the Entity-List, which prohibits it from doing business with U.S. firms including Google, and purchase important chipset for both smartphone and telecom businesses.
This new plan will allow Honor to bypass the restrictions imposed on Huawei and focus on high-end handsets as well as working on the corporate-oriented business. Also, Honor President, Geroge Zhao likely to serve as the CEO of the Honor after the partition.
Main Honor distributor Digital China Group Co Ltd will become a top-two shareholder of sold-off entity Honor Terminal Co Ltd with a near-15% stake, said two of the people. Honor Terminal was incorporated in April and is fully owned by Huawei, the corporate registry showed.
Following the sale, Honor has decided to retain its management team and over 7000 workforces and go public within three years. However, there’s an official confirmation yet to come on this matter.