Lenovo has announced that it will set-up a new smartphone and services firm in China next year. The new company will operate under a separate name and brand under the leadership of Chen Xudong, currently president of Lenovo’s China geography and Asia Pacific – Emerging Markets (East Asia, Hong Kong, ASEAN and India).

As per a press release issued by Lenovo, its smartphone business will continue to operate as usual and the new firm will exclusively focus on direct-to-consumer sales, marketing and product development using an internet-based business model, similar to Xiaomi, taking on which seems to be the main reason behind this announcement from Lenovo.

The new firm will go live on April 1, 2015 and will not only focus on devices, but also on software and application development and close customer engagement. Lenovo has stated that it will share details about the legal structure, financing plans, business strategy, product plans and organizational structure in the coming months.

It is an interesting time to build a new smart devices firm as with Motorola-deal expected to close in the new few months, Lenovo will now have a total of three brands selling smartphones and smart devices next year.