Report: Huawei considering bid for Motorola's networks business

China's Huawei is working to calm U.S. government concerns about its alleged ties to the People's Liberation Army in advance of a potential bid for Motorola's networks business, according to a report in the Financial Times.

The report, without citing sources, said Huawei is stepping up its lobbying efforts to ease worries about a possible bid for Motorola's networks unit as well as possible other, future U.S. deals. Huawei is considering a "mitigation agreement" with the U.S. government--similar to what France's Alcatel did when it purchased Lucent in 2006.

The agreement could stipulate strict security procedures, which may include a U.S. board to oversee sensitive operations. In 2008, Huawei abandoned a bid for networking solutions company 3Com over security concerns.

Huawei denies any connection to the Chinese military, but its founder, Ren Zhengfei, is a former PLA solider. "We are aware that some in the U.S. government have expressed concerns about Huawei, and we will work diligently to address those concerns," Charlie Chen, Huawei USA's senior vice president of marketing, told the FT.

Representatives from Huawei and Motorola declined to comment.

Huawei's apparent interest in Motorola's networks unit comes weeks after another FT report on the topic, in which Motorola left the door open to selling its mobile networking business or combining it into a joint venture with a rival vendor--possibly the Chinese vendor. "I think the network business will be viable for a very long time," Motorola co-CEO Greg Brown told the FT recently. "If there is an alternative configuration or partnership which provides more economic value to us, we will consider it."

For more:
- see this FT article

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