China Huawei unit attracts AT&T, Blackstone- paper

HONG KONG May 19 (Reuters) - Telecom industry players such as AT&T (T.N) and private equity funds such as Blackstone are interested in bidding for the handset unit of Shenzhen-based Huawei [HWT.UL], a Hong Kong newspaper said on Monday.

South China Morning Post cited sources as saying the sale of more than 50 percent of the handset unit by China's largest telecom equipment maker Huawei Technologies would fetch at least $2 billion.

The potential sale also drew interest from U.S. phone company Verizon Communications (VZ.N), and British mobile phone firm Vodafone (VOD.L), as well as private equity firms such as TPG and Kohlberg Kravis Roberts, the paper said.

Formal bids are due next week, the paper said. It gave no further details.

A U.S. newspaper reported earlier in May that Huawei was mulling the sale of a multibillion dollar stake in its mobile devices unit to a foreign investor.

The interest comes after Huawei along with private equity partner Bain Capital failed to acquire Nasdaq-listed computer network equipment maker 3Com Corp COMS.O earlier this year as the transaction was blocked by U.S. authorities on national security grounds. (US$1=HK$7.8) (Reporting by Donny Kwok; Editing by Keiron Henderson)