Japanese IT and electronics giant NEC is reportdly abandoning its ailing smartphone business after a deal with Chinese PC giant Lenovo failed, according to reports from Japan. Rumours emerged earlier this month that NEC had been chatting to the Chinese firm since 2013 about selling its smartphone business or partnering up. Now a Nikkei report says that NEC had offered Lenovo a majority stake in NEC Casio Mobile Communications but has now decided to exit the loss-making business after a deal couldn't be struck. NEC's talks with Lenovo over a mobile phone venture have reportdely stalled due to disagreements over majority ownership and patents.

NEC is also into a joint venture with Fujitsu and Docomo on the development of smartphone chips.

A NEC spokesman told us that no decision has been made yet on the company's smartphone business. The company is still considering several options, including talks with a potential partner other than Lenovo, or halting the development of new smartphones and focusing on its existing lines of feature phones.