What you need to know
- Huawei is said to be in talks with a few Chinese companies to sell parts of its Honor sub-brand.
- Digital China Group, TCL, and Xiaomi are apparently interested in acquiring the Honor smartphone business.
- Huawei launched the Honor brand in 2013 to take on the likes of Xiaomi, Vivo, and OPPO in the budget phone segment.
A new report from Reuters claims Huawei is currently in talks with Digital China Group to sell parts of its Honor sub-brand. The deal is likely to fetch Huawei close to 25 billion yuan ($3.7 billion).
According to people familiar with the matter, Huawei is no longer keen on the budget smartphone segment. The Honor sub-brand, which was launched in 2013, is mainly targeted at value-conscious consumers. Since Huawei's smartphone business has been severely impacted by the recent U.S. sanctions in markets outside China, the company now wants to focus on higher-end devices instead.
Even though the assets that will be sold haven't been finalized yet, Huawei is likely to sell Honor's brand, R&D capabilities, as well as the supply chain management business. Digital China, which is said to be the frontrunner, is currently the main distributor for Honor devices. Aside from Digital China, other Chinese tech companies like TCL and Xiaomi are said to be in the running as well.
TF International Securities analyst Ming-Chi Kuo believes that a potential sale of the Honor smartphone business could be a win-win situation for the brand, as well as the Chinese electronics industry. Kuo wrote in a recent research note:
Honor posted less than 5 billion yuan in net profit last year, due to the wafer-thin margins in the budget phone market globally.
Huawei P40 Pro
While it may not have any Google apps or services, the P40 Pro is one of the most impressive Android phones out there when it comes to photography prowess. In addition to the highly capable quad-camera setup on the back, the P40 Pro also has a vibrant OLED screen and a 4200mAh battery.
Huawei already dismissed this rumour by Ming-Chi last week.
HTC didn't work out too well for Google. Huawei makes some nice phones. Hopefully Google is interested.
Get the best of Android Central in in your inbox, every day!
Thank you for signing up to Android Central. You will receive a verification email shortly.
There was a problem. Please refresh the page and try again.