New Launch: Huawei apparently sells off the respected brand - and it is a smart move

New Launch: Huawei apparently sells off the respected brand - and it is a smart move

New Launch: Huawei apparently sells off the respected brand - and it is a smart move


Confirmation expected next week

About a month ago, reports out of China stated that Huawei might unload its Honor subsidiary to assist its to continue operations without the sanctions. New developments suggest that the deal has indeed skilled.

Chinese media outlets claim that the decoupling is within the final stages and therefore the official announcement will come around November 20. The independent Honor is claimed to be owned by a newly-formed venture between several top mobile distributors in China — Putian, Tianyin, China Post, Aishide, etc., and an investment trust with a background of Shenzhen SASAC. 

The acquisition cost isn’t mentioned, but it's expected to be within the range of 15-25 billion yuan, which approximately equals $2.2 billion to $3.7 billion. The state-owned company is additionally aiming for an IPO in three years.


The biggest advantage of the deal is that Honor could once more have direct trade relations with American companies, allowing it to source chipsets from Qualcomm and have access to full-fledged Android, among others. Since the sanctions are on Huawei (which includes Huawei Consumer Business Group and Huawei Enterprise also), a split should help Honor subvert those. The deal is additionally said to incorporate the whole employee base, research and development, and therefore the related supply chain, therefore the new owner wouldn't need to start from scratch. 

The split also will let Huawei specialize in the high-end market and telecommunication system, instead of pursuing slimmer profits that affordable Honor phones chase. Ming-Chi Kuo, one of the foremost reliable analysts within the consumer tech space, also suggests that the deal is going to be a “win-win situation” for the brands also because of the suppliers.

A report from Reuters also mentioned that Digital China, the most distributor of Honor devices, TCL, and Xiaomi were also curious about buying Honor. Huawei has remained mum over the speculations, but it shouldn’t be long till we get some clarity on the restructuring. 

We’ve approached Honor India for a press release on this development and can update the story accordingly.



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