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Huawei sells budget phone unit Honor to government, distribution partners – TechCrunch

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After weeks of rumors, Huawei confirmed it’s promoting its price range cellphone unit Honor to a consortium of corporations, together with government-backed corporations and Honor’s distribution companions, in response to a joint statement launched Tuesday morning in an area Shenzhen paper.

“This acquisition represents a market-driven funding made to avoid wasting Honor’s provide chain. It’s the greatest resolution to guard the pursuits of Honor’s shoppers, channel sellers, suppliers, companions, and staff,” mentioned the assertion signed by the 40 corporations.

Huawei misplaced main chip and software program suppliers after the U.S. authorities slapped commerce sanctions on the telecoms tools and smartphone large. A spin-out can in concept exempt Honor from the availability chain restrictions which have struck Huawei onerous.

Within the meantime, nobody within the consortium poses an existential risk to Huawei’s market place. That leaves sufficient leeway for Huawei if it ever desires to purchase Honor again from the group of government-backed corporations and cellphone sellers and brokers.

The announcement didn’t put a price ticket on the acquisition, although Reuters beforehand reported it may price 100 billion yuan ($15 billion).

That is an updating story.

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Rita Liao