Huawei selling smartphone unit in face of US sanctions

Chinese tech giant Huawei is selling its Honor smartphone brand in an effort to rescue the struggling business from damaging U.S. sanctions imposed on its parent company.

The move announced Tuesday is aimed at trying to revive Honor by separating it from Huawei’s network equipment and other businesses, which the U.S. government says are a security threat, an accusation Huawei denies. They are under sanctions that block access to most U.S. processor chips and other technology.

The announcement gave no financial details but said after the sale Huawei will have no ownership stake. The buyers are a group of 40 Chinese companies that include Honor retailers. Earlier news reports on rumors of a possible sale put the purchase price as high as 100 billion yuan ($15 billion).

“The move has been made by Honor’s industry chain to ensure its own survival,” said a Huawei statement.

The buyer is Shenzhen Zhixin New Information Technology Co., which was formed by a government-owned company in Shenzhen, the southern city where Huawei is headquartered, and a group of Honor retailers.