The board of 3Com scheduled a shareholder vote on a $2.2 billion buyout by a consortium that includes a Chinese company, signaling confidence the deal can clear antitrust and national security reviews, an Associated Press report said.
In a filing with the US Securities and Exchange Commission, the network equipment maker said shareholders are set to meet on February 29 to vote on a proposed buyout by private equity firm Bain Capital Partners and China's Huawei Technologies, the Associated Press report added.
Some attorneys familiar with the national security review said the deal continues to face significant resistance at some federal agencies because of Huawei's role, the report said.
Boston-based Bain Capital has said it is working to close the deal before the first quarter ends March 31 even though it has yet to get the government's OK.
The concern is whether sensitive military technology could be transferred to China via the minority stake held by Huawei, a Chinese telecommunications company, the report added.
In late September, Bain requested a national security review with the Committee on Foreign Investment in the US, a 12-agency group with the authority to recommend the White House block or alter terms of deals that involve national security.
The report further said Shenzen-based Huawei would hold 16.5% of the new company's stock and have the power to appoint three of the 11 board members. Bain Capital, which was co-founded by former partner Mitt Romney, a Republican presidential candidate Mitt Romney as a partner, would own 83.5% of the shares and appoint the other eight members.
Huawei would not hold management roles, a 3Com filing to the SEC said.
If approved, shareholders would receive $5.30 in cash for each share of 3Com stock, the report said.