Huawei reportedly sold Honor for 12.8 billion euros. Accused by U.S. sanctions, the Chinese group reportedly sold its subsidiary to a consortium including Digital China. In this way, Honor would be able to escape the restrictions imposed by Washington.
Honor 20. Credits: PhonAndroid
According to information gathered by our colleagues at Reuters, Huawei has sold its Honor subsidiary to a consortium of several Chinese firms,including Digital China. The company was already involved in the distribution of Honor smartphones in China. Other entities that make up the consortium include the government of the city of Shenzen.
Digital China would become the majority shareholder of the brand with 15% of the assets. Several shareholders financed by the Chinese state are added to the consortium, each with 10% of the company’s shares. The resale would include almost all of the subsidiary’s assets, including brand, research and development and supply chain management infrastructure. Despite the divestment, the consortium planned to retain the jobs of all employees at Honor. The manufacturer is also expected to become public within three years. Honor would therefore be owned by the Chinese government.
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Honor would escape U.S. sanctions
According to Reuters, the sale is mainly motivated by U.S. sanctions against Huawei. Once the sale is announced, Honor would escape restrictions imposed by the Trump administration. In fact, the subsidiary would be free to trade with U.S. partners or companies that rely on U.S. technologies. Ultimately, Honor could incorporate chipsets engraved by TSMC or designed by Qualcomm into its smartphones.
Moreover, the announcement shows that Huawei does not really expect the election of Joe Biden to change the game. Despite the excellent relationship between Biden and China’s leader Xi Jinping, most of the restrictions on Huawei, which came into effect during the Trump era, are expected to continue. Huawei would confirm the news shortly. Sources interviewed by Reuters say an official announcement was due to take place on Sunday, November 15. We’ll tell you more about it as soon as possible. While you’re waiting for more information, please comment in the comments below.
Source: Reuters
