Huawei, investment fund to buy 3Com for $2.2B

3Com has agreed to be acquired by Huawei Technology and investment fund Bain Capital for $2.2 billion.

Network equipment vendor 3Com has agreed to be acquired by associates of Bain Capital and of Huawei Technology in a deal worth US$2.2 billion, 3Com said Friday.

Huawei affiliate Shenzhen Huawei Investment & Holding Co. will take an unspecified minority stake in the company, and will be a commercial and strategic partner of the company, 3Com said.

3Com and Huawei are former joint venture partners. In 2003 they set up Huawei-3Com, an enterprise networking equipment company with headquarters in Hong Kong and factories in China. Last November, 3Com ended the alliance by paying US$882 million for Huawei's 49 percent stake in the venture, now called H3C Technologies Co.

As part of that sale, Huawei agreed not to compete with 3Com in certain markets, and remains one of the company's largest customers: around 30 percent of H3C's business comes from Huawei, company officials said Friday.

It's not the first time this year that investment funds have taken a major networking company private: enterprise telecommunications equipment vendor Avaya was bought by Silver Lake Partners and the Texas Pacific Group for US$8.2 billion.

Reports that 3Com was for sale have been circulating since earlier this year. Back in July, networking rival Nortel Networks was said to have shown an interest.

The US$2.2 billion price tag represents a 44 percent premium over Thursday's closing share price, 3Com said. Bain hopes to close the deal by the first quarter of next year, subject to shareholder and regulatory approval.

3Com reported financial results for the quarter to Aug. 31 last week. Sales for the quarter totaled US$319 million, up 6 percent on a year earlier, but the company's net loss widened, to US$18.7 million from US$14.1 million a year earlier.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Peter Sayer

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?