Huawei Seeks $1 Billion in Financing

As tensions between the US and China escalated, Huawei sought financing to continue operating. The company expects a $1 billion investment from a small group of people. We can say that this search for financing is the first major investment test for Huawei after the ban. Some hearsay from the employees of the company, who did not want to be named, is that Huawei is planning a 5 and 7-year maturity on this investment.

Nothing is certain at the moment. All developments regarding Huawei are still in the early stages of discussions. Most of the claims and decisions mentioned in the subjects may change in the future. The same goes for the financing issue, but if an agreement is reached on this issue, some things will become clear. Factors such as participating banks and Huawei’s loan pricing will give some clues that may reveal the financial strength of the company in the future.

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According to its 2018 annual report, Huawei had $5.3 billion in unsecured bank loans as of December. At the same time, the company has cash at approximately 2.6 times the total debt ratio.

Huawei’s latest attempt to find financing comes after it took $2 billion in loans from 5 Chinese banks. In September, the company raised $1.5 billion from 10 banks, mostly international.

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