Huawei abandons 3Leaf acquisition

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Just short of nine months after completing its purchase of 3Leaf Systems, Huawei Technologies Co. Ltd. has caved to pressure from U.S. trade authorities and abandoned its battle to take control of the company.
The Chinese vendor first ran afoul with the Committee on Foreign Investment in the United States last May when it neglected to seek approval from the agency after it bought some of 3Leaf’s assets (including staff) for $2 million.
Until now, Huawei has maintained a determination to see the transaction through, but pressure from U.S. authorities never waved.
“This was a difficult decision, however we have decided to accept the recommendation of CFIUS to withdraw our application to acquire specific assets of 3Leaf,” Huawei said in a statement.
“Huawei will remain committed to long-term investment in the United States. The significant impact and attention that this transaction has caused were not what we intended. Rather, our intention was to go through all the procedures to reveal the truth about Huawei.”
The company’s previous attempts to buy into the U.S. market by acquisition have failed for similar reasons. It gave up a bid for 3Com in 2008 after security concerns, particularly with regard to the company’s purported connection to Chinese military, were raised. More recently, Huawei’s bid to supply equipment to Sprint Nextel Corp. failed to gain traction, but for its part Sprint never publicly why the company was overlooked for its major network overhaul.

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Matt Kapko

Former Feature writer for RCR Wireless News
Currently writing for CIO
http://www.CIO.com/
Matt Kapko specializes in the convergence of social media, mobility, digital marketing and technology. As a senior writer at CIO.com, Matt covers social media and enterprise collaboration. Matt is a former editor and reporter for ClickZ, RCR Wireless News, paidContent and mocoNews, iMedia Connection, Bay City News Service, the Half Moon Bay Review, and several other Web and print publications. Matt lives in a nearly century-old craftsman in Long Beach, Calif. He enjoys traveling and hitting the road with his wife, going to shows, rooting for the 49ers, gardening and reading.

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