NEW YORK (TheStreet) -- Shares of Hewlett-Packard Co. (HPQ) are up by 0.24% to $33.15 in pre-market trading on Thursday, after the global technology and electronic products provider announced its plan to sell a majority stake in its China data networking business to a subsidiary of Tsinghua Holdings.
The Tsinghua Holdings subsidiary, Unisplendour Corp., will purchase a 51% stake in a newly created business made up of H3C Technologies and HP's Chiba-based server, storage and technology services businesses for approximately $2.3 billion, valuing the total business at $4.5 billion (net of cash and debt).
"HP is making a bold move to win in today's China. Partnering with Tsinghua, one of China's most respected institutions, the new H3C will be able to drive even greater innovation for China, in China," HP CEO Meg Whitman said in a statement.
"The combined company will build upon an extensive and valuable patent portfolio, best-in-class products and customer focus, and Tsinghua's world-class research capability. In one move, we have repositioned HP and H3C to accelerate overall performance and better serve our customers and partners," Whitman said.
Additionally, HP will report its 2015 second quarter earnings results after the market close this afternoon.
Separately, TheStreet Ratings team rates HEWLETT-PACKARD CO as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate HEWLETT-PACKARD CO (HPQ) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its attractive valuation levels and increase in stock price during the past year. We feel its strengths outweigh the fact that the company has had sub par growth in net income."