Huawei plans to sell the entire Honor mobile phone business as a package, in a deal priced at about 100 billion yuan based on Honor's 6 billion yuan profit last year and 16 times PE, 36kr.com said Tuesday, citing people with knowledge of the deal.
The acquirers include Digital China, three state-owned institutions, and a minority shareholder camp made up of companies such as TCL.
Reuters reported earlier on Tuesday that Honor's sale price was $15 billion, or 100 billion yuan. But 36kr, citing people with knowledge of the matter, said the Honor sale price could be set at 200 billion yuan against Xiaomi's market capitalization.
"The shares are relatively evenly held in this deal, with the highest stake in Digital China," the same source told 36kr, adding "Honor management also holds the shares."
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It was previously reported that Huawei plans to sell part of its stake in Honor for about $3.5 billion. In response, the sources told 36kr, "This was the last phase of the deal, when Huawei was only planning to sell one-third of Honor's shares, and the latest plan is to sell the whole business."
Along with the sale of Honor's stake, Honor's mobile phone team is set to undergo a major staffing restructuring. Sources said Honor's 8,000 employees will be moved out of Huawei's Sakata headquarters to its office space in Meilin, Shenzhen.
At the same time, Huawei will have a number of top executives joining Honor as core executives after Honor raises independent funding.
According to 36kr, Wan Biao, COO of Huawei's consumer business, will join Honor, while He Gang, formerly president of Huawei's terminal phone product line, will serve as COO of Huawei's consumer business.
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Richard Yu, the most prominent executive in Huawei's terminal business, will not join the spun-off Honor, the report said.
Several Huawei employees told 36 Krypton that they had recently received a transfer note from the company, and that an entire team had been transferred to Honor.
"Honor previously relied on Huawei for its own R&D and supply chain, and after independence, Huawei's people were needed to support the business in the past." A Huawei employee told 36 Krypton, "There are many more Huawei middle and senior management to join Honor in the future."
Honor, Huawei's Internet phone brand launched in 2013, was separated from the Huawei system in April this year to become an independent entity.
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