Huawei has been facing various problems since last year as a result of US sanctions, and a report last month said it had decided to sell its subsidiary Honor.
In October, Reuters reported, citing sources, that Huawei could sell its budget smartphone brand Honor for 15 to 20 billion Chinese yuan.
Now, according to a new Reuters report, Huawei could sell Honor to a consortium of Shenzhen government and iService supplier Digital China for 15 15 billion.
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The report, citing unnamed sources, claimed that the agreement could be reached by Sunday this week.
Huawei will also hand over almost all of its assets, including brand ownership, research and development, and supply chain management to the new management.
According to the report, several investment companies are expected to be part of the deal.
The sale of the honor also indicates that Huawei does not expect the arrival of a new US president to improve conditions for it.
Huawei sold 55.8 million smartphones worldwide during the second quarter of 2020, of which 26% were from the Honor brand.
A report last month said that splitting from Huawei would boost Honor’s phone sales as it would not face US trade sanctions.
As a result of US sanctions, Huawei is currently facing a shortage of equipment to manufacture its smartphones.
Honor’s smartphones are quite cheap, and during the first quarter of 2019, about 50% of phones sold outside of China were sold in India and Eastern Europe.
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But the rate fell to 28 percent in the second quarter of this year as US sanctions tightened.
Separation from Huawei will make it less likely that Honor will have difficulty acquiring the tools needed to make smartphones, especially companies that cannot currently do business with Huawei, such as Samsung and TSMC. ۔
However, it remains to be seen whether Honor will be placed on the sanctions list by the United States.
It should be noted that Huawei founded the Honor brand in 2013, but it operates independently.