Why Did The U.S. Government Kill Bain-3Com?
By Sean Michael Kerner March 21, 2008 With $2.2 billion on the table, the U.S. government may well be the culprit for derailing the proposed buyout of 3Com by Bain Capital. Bain formally withdrew its offer yesterday citing the equivalent of irreconcilable differences with 3Com over how to deal with the U.S. Treasury Department’s Committee on Foreign Investment in the United States (CFIUS). 3Com is now seeking a $66 million breakup fee. How did it all go so wrong? Well from the start there were concerns about the third party in this deal, China-based networking vendor Huawei Technologies. In late November, U.S. Rep. Ileana Ros-Lehtinen (R-Fl.), ranking Republican on the House Foreign Affairs Committee, called for a halt to the deal. Rep. Thad McCotter (R-Mich.), chairman of the Republican Policy Committee, also raised concerns about the transaction on charges that Huawei has links to the Chinese military. Considering that 3Com and Huawei had a joint venture called H3C for a few years, I
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- Why Did The U.S. Government Kill Bain-3Com?
