(Bloomberg) -- The parent of China Mobile Ltd. has invested in Honor Device Co., a big boost for a fast-expanding smartphone brand that was spun out of Huawei Technologies Co. just four years ago.

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China Mobile Communication Co., the parent of the nation’s leading mobile operator, has invested in the handset company, Honor said in a statement emailed to Bloomberg News. That marks the start of an alliance with a smartphone brand ranked fourth in China shipments in the June quarter, according to IDC.

“Both parties will give full play to their respective advantages and jointly provide consumers with a better and more innovative experience,” an Honor spokesperson said on Friday.

Shenzhen-based Honor split off from Huawei Technologies Co. in 2020, averting US trade sanctions that stifled the larger company’s mobile business. Backed primarily by local government entities, the firm is making preparations for an initial public offering and also counts display maker BOE Technology Group Co. as an investor.

The new investment gives China Mobile access to a smartphone maker just as the market begins to recover from a post-Covid funk. Average revenue per mobile user for Chinese carriers is slipping, subscriber growth is meager and digital services demand is slowing, according to Bloomberg Intelligence analysts Marvin Lo and Chris Muckensturm.

Honor has also made inroads internationally with its premium devices and a growing range of foldable handsets.

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