- Huawei is planning to sell parts of its Honor business in China.
- Honor is a budget-oriented brand focused on youth and first-time phone buyers.
- Xiaomi is said to be one of the prospective buyers for Honor business.
Huawei is allegedly planning to sell parts of its Honor smartphone business in a deal that can rake in CNY 25 billion (roughly Rs 27,251 crore). The company is battling business snags outside China that emerged after the US ban, which is why it seems no longer keen on continuing on its Honor phone business that targets affordable price segments, unlike Huawei's high-end phone business. Interestingly, Xiaomi -- Huawei's biggest rival -- might end up buying Honor business.
According to a Reuters report, Huawei is talking to Digital China Group and other suitors to sell a fraction of its Honor phone business. Honor brand is focused on budget-conscious customers. In India, Huawei pitted Honor against the likes of Redmi, Realme, and Motorola that are popular in this price segment. Not just the smartphones, Honor began selling its laptops, tablets, and audio products in India for affordable prices, but Huawei seems uninterested in taking this business forward.
Huawei is still to finalise the assets that it will sell for the Honor brand, but these could include the Honor brand, research and development arm, and related supply chain management business, said the report citing people familiar with the matter. Huawei is looking for an all-cash sale that might fetch a smaller amount, somewhere between CNY 15 billion and CNY 25 billion, according to the report.
Digital China has emerged as the top runner for this deal. It is the main distributor for Honor phones in China. But there are other potential buyers that could bid for Honor's business, including China's electronics manufacturing company TCL and, its biggest rival, Xiaomi. But nothing is confirmed about who is making inroads with Huawei over the Honor business deal.
Huawei, Xiaomi, Digital China, and TCL declined to comment on what is happening about Honor's business.