Huawei has just announced the sale of its subsidiary Honor. Accused by U.S. sanctions, the Chinese group has resigned itself to parting with the mid-range smartphone brand. Honor is now owned by a Chinese consortium of forty companies. Independent of its parent company, Honor escapes the restrictions of the United States government.
After weeks of rumors, Huawei has finally announced the sale of the Honor brand. “Huawei has decided to sell all of its Honor business assets to Shenzhen Zhixin New Information Technology,” the Chinese firm said in a statement on its website on November 17, 2020. Last I heard, Honor was sold for 12.8 billion euros.
Honor is now owned by a consortium recently created by 40 Chinese companies. There are distributors, firms specializing in online sales or many publicly traded companies. “Once the sale is completed, Huawei will not hold any shares or participate in any business management or decision-making activities in the new Honor company,” Huawei said.
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Huawei Releases Honor from U.S. Sanctions
The purpose of this transaction is to free Honor from U.S. sanctions against its former parent company. On a blacklist since Trump’s executive order came into effect, Huawei is no longer able to trade with U.S.-based firms. In the end, the group can no longer collaborate with TSMC. Production of Kirin chipsets has stalled.
“This decision was made by Honor’s industrial chain to ensure its own survival,” Huawei said. Freed from Huawei, Honor is once again able to collaborate with technology-based firms from the United States. In theory, Honor should be able to purchase smartphone chips designed by Qualcomm or engraved by TSMC. Better yet, Honor could apply to get its Android license back from Google. De facto, the firm would be allowed to integrate Google’s apps and services, including the Play Store, into its smartphones. This is obviously to be confirmed.
“This acquisition is a market-driven investment. This is the best solution to protect the interests of Honor’s consumers, sellers, suppliers, partners and employees,” Shenzhen Zhixin New Information Technology said in its press release. As a result of this announcement, the Honor product catalogue is legitimately expected to be transformed. Until now, Honor-stamped smartphones and other devices relied almost entirely on technologies developed by its parent company. Without Huawei’s support, how will the Chinese brand evolve? While you’re waiting for more information, please comment in the comments below.
