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3Com, Bain and Huawei still talking buyout

New application for approval could be submitted, report says

February 29, 2008 12:00 PM ET

Computerworld - 3Com Corp. immediately adjourned a shareholder meeting today and plans to reconvene it next Friday to allow time for merger discussions to continue with Bain Capital Partners LLC and China's Huawei Technologies Co.

All three companies withdrew a filing before the Committee on Foreign Investment in the U.S. last week amid reports that the CFIUS was concerned over national security issues related to the proposed $2.2 billion deal.

A spokeswoman confirmed today that the meeting was postponed until 8 a.m. March 7, after 3Com issued a statement that the company is continuing to work with Bain to "construct alternatives" to the concerns raised by the CFIUS. The committee has raised national security questions regarding the investment by Huawei, which is based in Shenzhen, China, and has close ties to the Chinese government.

The Wall Street Journal reported today, citing unnamed sources, that the companies plan to resubmit an application for U.S. approval of the deal within the next several weeks.

Read more about Networking in Computerworld's Networking Topic Center.

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