Huawei Technologies is in advanced talks to sell its x86 server business after the U.S. blacklisting of the company made it difficult to secure processors from Intel, Bloomberg News reported.
China-based Huawei is selling the server business to a consortium that includes at least one government-backed buyer. Several potential buyers from government and the private sector emerged in recent months.

The x86 server line was not a core business for Huawei. The company has developed its own servers for its cloud-computing business, powered by ARM-based processors that use Huawei’s Kunpeng technology.

Henan Information Industry Investment, a state-owned firm that has been a partner of x86 and consumer electronics maker Huaqin Technology along with an asset management company representing the Hubei provincial government are involved in the talks.

Huawei sold its smartphone brand Honor to a consortium led by the Shenzhen government a year ago because the U.S. banned American companies like Qualcomm from supplying certain components, including 5G chips, to Huawei.

Huawei reported that third-quarter revenue slumped 38 percent to 135 billion yuan ($21.2 billion), the fourth straight quarterly decline in sales. Company’s Rotating Chairman Guo Ping said in a statement that enterprise businesses were stable while its consumer divisions have been “significantly impacted.”