Chinese smartphone maker Huawei is in talks with several Chinese electronics companies to sell parts of its Honor smartphone unit, Reuters reported Wednesday.

Details: Digital China, a Shenzhen-based cloud service provider, has become the frontrunner in the contest to buy Huawei’s Honor business. Other suitors include Chinese electronics maker TCL and budget smartphone maker Xiaomi, according to Reuters, citing people familiar with the matter.

  • The deal could include the Honor brand, research and development capabilities, and related supply chain management business.
  • The deal may be an all-cash sale and could worth somewhere between RMB 15 billion (around $2.2 billion) and RMB 25 billion, one of the sources said.
  • Honor is a budget smartphone brand that Huawei established in 2013. The business mostly operates independently from Huawei, Reuters said.
  • Huawei has been heavily restricted from accessing advanced semiconductors that are crucial to its smartphone production. A change of owner may help Honor circumvent the restrictions, according to Kuo Ming-chi, an analyst at TF International Securities.

Go deeper: Exclusive: Huawei in talks to sell parts of its Honor smartphone business – sources – Reuters

Writing about semiconductors and telecommunications.