Huawei sells its Honor subdivision for an undisclosed figure
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The sale of Honor has gone through, after weeks of rumours that Huawei was planning to off-load its subdivision. This time, Huawei has made an official statement on the matter, confirming that Shenzhen Zhixin New Information Technology Co., Ltd will now own Honor. The long-winded name is actually a consortium of the former Honor sales company Digital China and the city of Shenzhen, as had previously been speculated.
As the screenshot below shows, Huawei has cited the impact of US sanctions for the reason why it has sold Honor. Huawei has clarified that 'Honor's industry chain' wanted to push through the move to ensure its survival in what its parent company described as 'in these difficult times'. Unsurprisingly, the difficult times to which Huawei refers has been brought about by US sanctions, rather than COVID-19 pandemic.
Huawei currently maintains shares in Honor, but it will cease to do so once the sale to Shenzhen Zhixin New Information Technology Co., Ltd has been completed. Presumably, Honor will not be bound by the restrictions that the US government has placed on Huawei, but there has been no official statement on this. Similarly, the value of the sale remains undisclosed. However, the deal is believed to have generated upwards of US$15.2 billion for Huawei. The sale of Honor includes all assets of the company, including its R&D department and the management of its supply chain.