Huawei is allegedly planning to sell parts of its Honor smartphone business in a deal that can gross CNY 25 billion (around Rs 27,251 crore). The company is battling business obstacles outside of China that emerged after the U.S. ban, which is why it no longer seems keen to continue its Honor phone business which caters to affordable price segments, unlike the business of high-end phones from Huawei. Interestingly, Xiaomi, Huawei’s biggest rival, may end up buying Honor business.
According to a Reuters report, Huawei is talking to Digital China Group and other suitors to sell a fraction of its Honor phone business. The Honor brand is focused on budget-conscious customers. In India, Huawei has pitted Honor against the likes of Redmi, Realme, and Motorola who are popular in this price segment. Not just smartphones, Honor has started selling its laptops, tablets and audio products in India at affordable prices, but Huawei seems uninterested in running this business.
Huawei has yet to finalize the assets it will sell for the Honor brand, but these could include the Honor brand, the research and development arm and related supply chain management business, the report said, citing people familiar with the matter. According to the report, Huawei is looking for an all-cash sale that could fetch a smaller amount, somewhere between CNY 15 billion and CNY 25 billion.
Digital China has emerged as the best in this deal. It is the main distributor of Honor phones in China. But there are other potential buyers who may be bidding on Honor’s business, including Chinese electronics manufacturing company TCL and, its biggest rival, Xiaomi. But nothing is confirmed about who is breaching the Honor trade agreement with Huawei.
Huawei, Xiaomi, Digital China and TCL have declined to comment on what is happening on Honor’s business.
Honor was launched in 2013 as Huawei wanted to reach younger, more budget-conscious customers.
- Huawei plans to sell part of its Honor business in China.
- Honor is a budget-oriented brand focused on young people and first-time phone buyers.
- Xiaomi is rumored to be one of the potential buyers for the Honor business.