Huawei shelves plan to sell stake in wireless device unit
- — 10 October, 2008 08:25
China-based networking equipment maker Huawei indefinitely postponed the sale of a stake in its wireless terminals manufacturing unit Wednesday, citing global financial uncertainty.
Stating that "current global market conditions and prevailing economic uncertainty" might adversely affect the sale, it put the deal for its mobile and consumer wireless devices business on the back burner. Huawei did not specify the size of the stake it planned to make available.
However, The Wall Street Journal reported Thursday that only two companies -- Bain Capital and Silver Lake -- invited to bid did so last week, and that those bids fell short of Huawei's expectations of around US$4 billion.
Last year, Huawei sought to join with Bain Capital to buy 3Com in a $2.2 billion, in which the Chinese company would have received a 16.5 percent stake. The deal was scuttled after the U.S. government expressed national security concerns over China's Huawei potentially having access to information about 3Com products used in U.S. defense contracts.