The deal will not include the acquisition of a direct stake and HTC will remain to run its remaining smartphone business, the News said, refusing to be named as the data has not been publicly stated.
HTC said in a filing to the stock market that it would hold a news interview at 10:00 a.m. Taipei time (0200 GMT) on the signing of an “essential cooperation agreement.”
HTC pieces were on a buying halt on Thursday. Google refused to comment.
HTC is a long-time associate of Google and manufactures the U.S. firm’s latest Pixel smartphone.
Google’s policy of licensing Android for free and profiting from embedded settings such as search and maps has made Android the powerful mobile operating system with some 89 percent of the global market, according to IDC.
But it has long been hindered by the development of many variations of Android and the irregular experience that has produced. Pushing its own device will likely complicate its relationship with Android licensees, analysts said.
“HTC is past its prime in terms of holding a leading hardware design house, mainly because of how many it has had to scale back over the years as because of decreasing revenues,” said Ryan Reith, an analyst at researcher IDC.
“Unless Google really needs to control hardware for its other companies like Home and Chromebooks in addition to smartphones, then I don’t see this as being a bet that pays off.”
HTC, which once traded one in 10 smartphones globally, has seen its business share dwindle sharply in the face of fiery competition from Apple Inc (AAPL.O), Samsung Electronics Co (005930.KS) and Chinese rivals.
Its share price has also experienced steep declines over the past couple of years. The property has fallen 12 percent so far this year and the business is worth around $1.9 billion.
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