China's Huawei Technologies Co Ltd's said Friday its acquisition of U.S. network equipment maker 3Com Corp with Bain Capital Partners LLC is for nothing but a business investment.
Huawei, the country's top telecom equipment maker, made the announcement after the three parties withdrew their joint filing to U.S. regulators concerning the $2.2 billion proposed acquisition.
"Huawei joined in the acquisition of 3Com at the invitation of Bain Capital Partners LLC in early 2007 as a minority partner. Both sides launched the acquisition for business concern," according to a statement released by Huawei on Friday.
"We announced the withdrawal of the acquisition based on the concerns like complicated purchasing procedures, the rising cost and the changing stock market," Huawei said. "3Com showed understanding and agreement for our decision and Huawei will continue the friendly cooperation."
On Sept. 28, 3Com's board of directors unanimously approved the acquisition plan brought by Bain Capital Partners LLC and Huawei, under which Huawei would have owned as much as 21.5 percent of 3Com.
The three parties submitted the proposed transaction to the Committee on Foreign Investment in the United States (CFIUS), a panel led by the U.S. Treasury Secretary that reviews corporate acquisitions involving foreign buyers.
Founded in 1988, Huawei is China's largest communications equipment maker and specializes in research and development, production and marketing of communications equipments, and providing customized network solutions for telecom carriers.
Huawei and 3Com have previously collaborated as they founded a joint venture, the Chinese networking operation H3C (Huawei-3Com), in 2003 for Internet Protocol-based routers and switches. Huawei eventually sold its 49 percent stake to 3Com in 2007 for 880 million U.S. dollars.
(Xinhua News Agency February 23, 2008)