HTC will be making a major announcement in the coming days.
Taiwanese media reported earlier this month that HTC was in the “final stage of negotiation with Google” for selling off its smartphone business, and it looks like things are coming to a head. Bloomberg says that HTC will halt trading its shares tomorrow “pending a major announcement,” which will be Google’s purchase of HTC’s phone business.
From the Taiwan Stock Exchange Corporation (TWSE):
TWSE announced trading in the shares of HTC Corporation (Code：2498) and the securities underlying the company will be halted starting from Sep 21 2017 pending the release of material information. The company will apply for resumption of trading after the release of material information.
Google is expected to buy HTC’s smartphone business altogether, taking on its research and development, manufacturing, distribution and supplier ties. HTC will continue to operate its other business units, but it isn’t yet clear what would come of its HTC-branded phones.
According to China Times, an announcement will be made within two days’ time. According to the publication, HTC CEO Cher Wang is in Taiwan for a Town Hall at the company’s headquarters, with the executive likely briefing staffers over the upcoming announcement. Evan Blass managed to get a hold of the invitation for the Town Hall, noting that Google will likely acquire HTC’s hardware assets:
[2] According to this person, the companies have finalized a deal wherein GOOG will acquire certain HW eng assets, but HTC retains its brand
— Evan Blass (@evleaks) September 20, 2017
HTC is already the manufacturer of the upcoming Pixel 2, and should an outright acquisition occur, Google is better positioned to absorb HTC’s manufacturing facilities into its own hardware unit. As Alex noted in his piece a few weeks ago, the deal would be different from Google’s acquisition of Motorola back in 2012:
Google didn’t buy Moto in 2012 to own a smartphone manufacturer. Instead, it paid up to nip in the bud an existential threat to Android.
If Google buys the smartphone side of HTC in 2017, it’ll be doing so to own a smartphone manufacturer, securing the manufacturing capacity, supply chain expertise and design talent it needs to build Pixel phones, Pixel tablets and, who knows, maybe watches, laptops and other devices, completely in-house. It’d bring some much-needed vertical integration to Google’s new hardware division, at a time when it’s also rumored to be interested in building its own silicon.
Whatever deal Google makes with HTC would exclude Vive, which is a separate business unit. HTC, for its part, has said that it does not “comment on market rumors or speculation.” We should know more very soon.
