Huawei Announces Sale of Honor Phone Business in Order to Ensure Brand's Survival
Honor logo. (Image Credit: Honor)
Chinese smartphone manufacturer Huawei has announced that it is selling off its Honor brand in order to ensure its survival, following 'tremendous pressure' and 'a persistent unavailability of technical elements needed for its mobile business.' In a statement, Huawei said that it will sell all of its Honor business to a company called Shenzhen Zhixin New Information Technology. "This sale will help Honor's channel sellers and suppliers make it through this difficult time," Huawei said in its statement. Exact details of the deal have not been disclosed.
Huawei said that once the sale is complete, the company will not hold any shares or be involved in any business management or decision making activities regarding the new Honor company. The company said that the move has been made by Honor's industry chain to ensure its own survival. "This sale will help Honor's channel sellers and suppliers make it through this difficult time," Huawei said. The Honor brand was established by the Chinese company to focus on the youth market by offering phones in the low-end to mid-range price points.
Honor's products also rely heavily on Huawei's technology, hence the brand was also affected by the US sanctions imposed on Huawei. Under the new ownership, Honor should have the flexibility to develop its products and potentially deal with the likes of Qualcomm and Google.
Huawei, in its statement, did not disclose the terms of the deal. However, a report in Reuters had earlier this month speculated that a proposed Honor sale could cost roughly CNY 100 billion (roughly Rs 1.13 lakh crores).