U.S. government nixes 3com deal, in your face China!

After the Committee on Foreign Investment in the US (CFIUS) signaled its intention to block the transaction, Bain Capital and Huawei Co. have called off the planned purchase of US-based 3Com. The deal, which was agreed to last September, had China-based Huawei and private-equity firm Bain Capital acquiring 3Com for $2.2 billion.

The deal was structured so that Huawei would have a minority 16.5 percent stake in the company, as it would have been one of Bain’s “affiliates.” As is customary for deals involving buyouts of US companies by foreign investors, the transaction was submitted to CFIUS for its approval.

The US government expressed fears, however, that the deal had siginficant national security implications. Lenovo’s purchase of IBM’s PC business caught the attention of CFIUS in 2005, with the Committee examining the transaction carefully to ensure that IBM’s facilities would not be used for industrial espionage. CFIUS approved the deal a few months later, though it later reviewed a huge purchase made by the US State Department from the hardware company. (link)

Advertisements

0 Responses to “U.S. government nixes 3com deal, in your face China!”



  1. Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s




Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Join 29 other followers

Technorati – Blog Search

Add to Technorati Favorites

submit express


%d bloggers like this: