Huawei may sell premium smartphone brands P and Mate.
That's according to two Reuters sources.
Talks are reportedly ongoing with a consortium led by Shanghai government-backed investment firms.
Huawei has denied the report, saying there is no merit in it.
Shanghai officials said they weren't aware of the situation.
One of the sources says Huawei started exploring a possible sale as early as last September.
It's apparently motivated by insufficient access to chip supplies amid U.S. sanctions.
Since May 2019 Huawei has faced restrictions over allegations that it's a threat to national security.
The sources say the potential divestment is a sign the firm doesn't expect relief from U.S. sanctions, even a with a new administration in Washington.
Now any divestment could be a very big deal.
Shipments of P and Mate phones were worth 39.7 billion dollars over the year to the third quarter of 2020.
Last year Huawei sold off phone brand Honor in a deal one source valued at about 15.5 billion dollars.
That seems to have helped the budget handset maker, which last week said it had deals with firms including Intel and Qualcomm over chip supplies.