Huawei and Bain spent $2.2 billion to buy 3Com Huawei holding a small number of shares

Source: Internet
Author: User

On August 1, September 28, Beijing time, according to foreign media reports, Bain Capital and Huawei will jointly acquire 3Com for about $2.2 billion, and 3Com has agreed to the agreement.

According to the agreement, the shares held by 3Com's original stock holders will be acquired in cash at $5.30 per share, it is equivalent to Bain Capital and Huawei, so they paid a September 27 price higher than 3Com's share price of $3.68 per share in 44%. After the news that 3Com was about to be acquired burst, 3Com's share price immediately rose.

The message said the deal will be completed in the first quarter of next year, when Huawei will receive a minority stake. "We firmly believe that this agreement is beneficial to 3Com and will allow 3Com to better establish its position as a global Internet leader," said the president and CEO of 3Com, this is good for our employees, our customers, and our partners."

According to the analysis, the conclusion of the agreement shows that the market for financing and buying is not completely dead, but its emerging vigor is from China.

Previously, it was rumored that the Canadian Equipment Company Nortel had intentionally acquired 3Com, but because Bain Capital and Huawei joined hands to ensure their position in the acquisition, Nortel Network took the initiative to withdraw.

Huawei is important to Bain Capital because Huawei once signed a non-compete agreement with 3Com's core asset H3C. H3C was previously a joint venture between Huawei and 3Com, and was subsequently acquired by 3Com. If beidian won the purchase right, it will have to face competition with Huawei.

Just before the announcement of this message, Sohu IT called a senior manager of Huawei and had an intriguing answer like "there are many possibilities for Huawei to buy 3com. The senior manager said that Huawei made telecom-level solutions, while 3com focuses on Enterprise Network products. Huawei gave up H3C at the beginning, which means that it no longer considers this product field too much. Therefore, simply looking at its business development, acquiring 3com is of little significance.

"If it is acquired, it will be the company's strategic consideration ." Said the Huawei leadership.

In addition to H3C, 3Com has a majority of its value in its Tipping Point Department, which provides network security design. 3Com had previously expressed its intention to split the Department to public, but the plan may not be implemented after it was acquired by Bain Capital and Huawei. Bain Capital has launched extensive acquisitions in recent years, while Huawei is China's largest telecommunications equipment manufacturer. Huawei's business has rapidly expanded globally, use its low-price advantage to compete with western rivals such as Cisco and Alcatel.

The analysis shows that 3Com will be able to fully enter the Chinese market after it is acquired to meet the strong demand for network equipment in the Chinese market. However, some analysts believe that the risks posed by the two enterprises that cross the Pacific Union may affect the development of 3Com.

  • According to the analysis, Bain Capital and Huawei aim to private 3Com
  • Ren zhengfei, CEO of Huawei: 3Com is a commercial investment.

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