Huawei, Bain abandon bid for 3Com

Huawei Technologies and US private equity firm Bain Capital have given up on a plan to acquire 16.5% of 3Com for US$2.2 billion due to US concerns, the Financial Times reported. The companies were unable to secure approval for the deal from the Committee of Foreign Investment in the US, which vets foreign investments in sensitive sectors, despite taking significant measures to assuage political concerns over the purchase. For example, telecom equipment manufacturer Huawei had agreed to have no management control over the US computer networking company, though it would have gained seats on the board. Bain was also prepared to divest a 3Com unit that sells security software to the US government in order to secure the deal.