Honor's sale for US$15.2 billion could free it from Huawei's US trade sanctions
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Honor has only been around since 2013, but it seems that Huawei is ready to shed its youthful sub-brand. There had been rumours of Xiaomi acquiring Honor for US$3.73 billion, but Huawei swiftly denied that this was the case. However, Reuters now claims that a consortium of buyers is prepared to purchase Honor, including Digital China and the government of Shenzhen.
According to Reuters, the deal will be worth up to CNY 100 billion, which is equivalent to US$15.2 billion. Huawei is yet to confirm this, but Reuters claims that the deal could be announced as early as next Sunday. Apparently, the sale will include almost all of Honor's assets, such as the brand, its R&D department and management of its supply chain. Additionally, the sale will be all-cash, but Honor will retain most of its management team, along with its 7,000-strong staff.
While sales like these are not unusual, it will be interesting to see what stance the US government takes on the sale of Honor. Currently, Honor is subject to the same trade restrictions as Huawei, but a break from the company should end that. If that is the case, then Honor should be free to use Google Mobile Services (GMS) again, although it would be unclear what OS the company would use on its smartphones. Similarly, Reuters did not disclose whether Honor would continue to sell laptops, tablets and wearables, which are mostly re-branded Huawei devices.