Despite being highest bidder Bloomberg has reported that Chinese telecoms equipment manufacturer lost out on the purchases of a Motorola unit and 2Wire last month as the sellers were led to believe the US government would block the transaction. Huawei…
Despite being highest bidder Bloomberg has reported that Chinese telecoms equipment manufacturer lost out on the purchases of a Motorola unit and 2Wire last month as the sellers were led to believe the US government would block the transaction. Huawei reportedly offered more than US$100m each for the software developer 2Wire and the Motorola unit. Nokia Siemens Networks bought the Motorola unit last month for US$1.2bn. The Huawei offer was reportedly 10% higher than NSN’s bid and to make up the difference, NSN let Motorola keep an additional US$150m in accounts receivable, cash and some other assets. In addition, Motorola was also allowed to retain most of the patents for its wireless network infrastructure business.
2Wire was sold to UK-based set-top-box manufacture Pace Microtech.
The source quoted was not named, as Huawei’s offers were never made in the public domain, but was close to the proposed deal.
Huawei has had problems in the US before. In 2008, the firm was forced to drop a bid for computer-equipment maker 3Com after the US government began investigating whether a deal would give China access to anti-hacking technology used by the Defence Department.
Huawei has hired Morgan Stanley in its attempts to purchase US assets. The company is also being assisted by law firms Sullivan & Cromwell and Skadden, Arps, Slate, Meagher & Flom. Motorola is in the process of suing Huawei over alleged industrial espionage – a charge that Huawei has vigorously denied.
Huawei declined to comment on “press speculation”, as did Motorola.
