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Briefing: Huawei denies buyout by state-owned firm
Huawei Denies Buyout by State-Owned Firm-Yicai Global
What happened: China’s top smartphone and telecom equipment maker Huawei Technologies denied a rumor that it’s in the process of being acquired by a state-owned entity. The Shenzhen-based firm also rebutted reports about a business spinoff and about divesting some of its subsidiaries.
Why it’s important: Founded in 1987, Huawei is known as a private enterprise whose 180,000 employees hold all the stakes. The status of being an employee-owned company is one of the arguments that the company emphasizes to distance itself from allegations of government control. Due to the military background of its founder Ren Zhengfei, however, the company is cautiously warded off in the overseas market for security reasons. After failed efforts to expand to the US smartphone market, Huawei receives another blow in its core telecos equipment business as Australia banned the firm from selling 5G tech in the country. Huawei’s relationship with the government, especially in terms of ownership, could have a direct influence on the company’s overseas business.