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China - Business

Chinese stake at heart of 3Com takeover fears

By Stephanie Kirchgaessner in Washington and Jamil Anderlini in Beijing

Published: September 30 2007 15:02 | Last updated: September 30 2007 15:02

When Bain Capital announced that Huawei Technologies of China would become a “commercial and strategic” partner to 3Com as part of the private equity firm’s takeover of the US technology company, it did not address the fact that the deal might not be welcomed by at least one of 3Com’s customers – the US government.

Huawei is expected to acquire a 16.5 per cent stake in 3Com as part of a joint bid with Bain, according to a person familiar with the transaction, who says the minority stake will not ­create national security problems.

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