Report: Huawei to sell x86 server business

03 November 2021

Chinese technology giant Huawei Technologies is said to be shopping its x86 server business following its difficulty securing processors after the U.S. added the company to its Bureau of Industry and Security (BIS) Entity List in 2019.

The move, done by President Donald Trump through executive order, effectively blacklisted Huawei from any dealings in the U.S.

The executive order from the Trump Administration was issued because it believed that using equipment from Huawei might be a threat to national security due to the alleged ties the company had to the Chinese government. The Trump Administration believed that the equipment might be used to spy on consumers or national interests. The order also recommended that allies of the U.S. government should also blacklist Huawei, with Australia and New Zealand following suit. However, many European countries have not agreed and vowed to determine independently whether to use Huawei or not.

While the U.K. first balked at the idea of not using Huawei equipment, later, U.K. Prime Minster Boris Johnson ordered communications suppliers to stop using Huawei equipment and to also remove already installed 5G equipment by 2027.

Because of the executive order, Google suspended its business with Huawei and other semiconductor companies said it would no longer do business with the company, including Intel, Qualcomm, Xilinx and Broadcom. Intel is particularly important given the news about it potentially selling its x86 server business, as reported by Bloomberg.

According to the report, Huawei has been unable to find adequate supply of processors from Intel because of the blacklist. The company plans to sell the business to a consortium that includes at least one government-backed buyer; however, several potential buyers are possible including those from the government and private sectors.

State-owned Henan Information Industry Investment Co. Ltd. has been a partner of x86 and consumer electronics maker Huaquin Technology Co. Ltd. may be involved in the talks, Bloomberg reported.

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