"Huawei's consumer business has been under tremendous pressure as of late. This has been due to persistent unavailability of technical elements needed for our mobile phone business. Huawei Investment & Holding Co., Ltd. has thus decided to sell all of its Honor business assets to Shenzhen Zhixin New Information Technology Co., Ltd. This sale will help Honor's channel sellers and suppliers make it through this difficult time," the statement says.
The company specified that once the sale is complete, Huawei will not hold any shares or be involved in any business management or decision-making activities in the new Honor company.
Last week, reports emerged saying that the Chinese tech giant could sell its Honor budget series smartphone enterprise via a 100bn yuan ($15.2bn) deal.
This year, the US barred manufacturers from using American technology to produce chips for Huawei, claiming that the company might be facilitating Chinese spying, something that the tech giant has repeatedly denied.