Chinese vendor Huawei Technologies is a supporting partner in Bain Capital $2.2 billion proposal to acquire 3Com (Huawei would end up owning 16.5% of 3Com if the deal is completed). However, according to documents filed with the Securities and Exchange Commission, Huawei has the option to expand its stake in the company to 21.5% and gain up to 11 board seats.
This may raise more flags for people who are opposed to the deal. This includes a group of U.S. legislators who are concerned the deal would give a company closely connected to the Chinese government an ownership stake and board seats in a large U.S. firm, and could be a threat to U.S. national security.
- The Bain/Huawei takeover of 3Com was announced late last month