On November 10, according to foreign media reports, people with knowledge of the matter said Huawei plans to sell its smartphone division, Glory, to a consortium made up of Digital China and the Shenzhen municipal government for 100 billion yuan, in which Glory’s management will hold a stake.
The all-cash deal will include almost all of Glory’s assets, including branding, research and development and supply chain management, people with knowledge of the matter said. Huawei could announce the news as early as Sunday, one of the people said.
Digital China, which is the main distributor of Honor, will hold nearly 15 percent of the sold Honor Terminal Co Ltd, making it one of the 2 largest shareholders in the company, the two people with knowledge of the matter said. Honor Terminal was founded in April this year and is a wholly owned subsidiary of Huawei.
Shenzhou Digital also cooperates with Huawei in areas such as cloud computing. The company plans to obtain funds for the acquisition mainly through bank loans.
Also involved in the acquisition are at least three investment firms with Shenzhen government backgrounds, each holding 10 to 15 percent of the company, sources said.
After the deal, most of the members of Glory’s management team and its more than 7,000 employees will stay on. The company also plans to go public within three years.
Glory declined to comment on foreign media reports.
Digital China (SZ:000034) was up at 31.68 yuan today, with a total market capitalization of about 20.867 billion yuan.
Recent Comments