After much speculation about Honor’s imminent sale, parent company Huawei has made it official. With US restrictions limiting Huawei’s telecom consumer and commercial businesses, the company has sold off its secondary smartphone brand Honor.
The company has said, “At a difficult time when industrial technology elements are unsustainable and consumer businesses are under tremendous pressure, in order to allow Honor channels and suppliers to continue, Huawei Investment Holding Co., Ltd. decided to sell the entire Honor business assets. The purchaser is Shenzhen Zhixin New Information Technology.”
Shenzhen Zhixin will fully acquire the Honor smartphone business. The agreement states that the acquisition will protect the interests of consumers, channels, suppliers, partners, and employees. Changes in ownership should not affect the direction of Honor’s development, and Honor’s senior management will remain on board.
The purchasing company was established by a consortium of more than 30 agents and distributors. ‘New Honor’ will oversee resources, branding, production, distribution, services, operations, and executive decisions. Huawei will no longer hold any share in Honor, nor will it be a part of the company’s executive board any longer.
The US had accused Huawei of posing a threat to national security and banned American companies from doing business with them. This hindered both Huawei and Honor from using any American components. Qualcomm was also initially not allowed to sell chipsets to Huawei, while Google revoked both Huawei and Honor’s license to use Google’s suite of apps.