HONOR, the Chinese smartphone brand that spun off from Chinese telecoms giant Huawei Technologies four years ago, has received an investment from telecoms carrier China Mobile ahead of its initial public offering (IPO).

Shenzhen-based Honor didn’t disclose the investment amount.

Honor was set up by Huawei in 2013 but sold in November 2020 after the parent firm was put on the U.S. government’s so-called entity list that prevents U.S. chipmakers from supplying Huawei. Honor said earlier this month it will initiate a shareholding reform in the fourth quarter and start the IPO process at an appropriate time.

China Mobile’s investment in Honor creates a good synergy in the personal and household terminal markets, as the former has advantages in channels and user resources, and the latter is a leader in the smart terminal field, thanks to its rich product portfolio, Honor said.

Honor will adhere to the principles of openness and transparency in its development and continue to diversify its equity structure, it added.

Honor ranked fourth in China’s smartphone market in the second quarter with shipments of 10.4 million units, behind Vivo Communication Technology, Huawei, and Oppo Mobile Telecommunications, according to market researcher International Data Corporation (IDC). China’s smartphone market grew 8.9% to reach shipments of 71.58 million units in the second quarter, with Honor occupying 14.5% of the market share.

China Mobile is the largest telecoms operator in the country by user scale and revenue. As of June 30, it had 1 billion mobile users and 309 million were wired broadband users.

China Mobile’s net profit widened 5% to 80.2 billion yuan (US$11.3 billion) and revenue rose 3% to 546.7 billion yuan in the first half from a year earlier, according to the firm’s latest earnings report.

(SD-Agencies)