China's Huawei says expects 3Com buyout by Q1 2008

HONG KONG, Oct 18 (Reuters) - Top Chinese telecoms gear maker Huawei Technologies Co [HWT.UL] expects a $2.2 billion buyout of 3Com Corp (COMS.O: Quote, Profile, Research, Stock Buzz) with Bain Capital Partners to close in 2008's first quarter and said the deal was a commercial investment, making its first public comments since the deal was unveiled.

3Com said last month that a 16.5 percent stake in the U.S. network equipment maker would transfer to Huawei as part of a deal in which Bain would buy 3Com.

But U.S. lawmakers have since warned that Huawei's involvement threatened U.S. national security because of the Chinese firm's state-owned pedigree and alleged military ties.

Huawei, which is expanding aggressively abroad to take on the likes of Ericsson (ERICb.ST: Quote, Profile, Research, Stock Buzz) and Nokia-Siemens [NSN.UL], also said in a statement to Reuters that it posted a 62 percent jump in contract sales to $8.4 billion in the first half.

"This transaction is a commercial investment for Huawei," Huawei said in an e-mail on Thursday in response to Reuters' questions.

"As a strategic partner of 3Com, Huawei will enhance its capabilities in providing world-class end-to-end solutions to its customers. Moreover, this investment will provide value-added income in the longer term."

For details on the deal, please click on [ID:nN11352361].

For details on U.S. concerns over Huawei's and Bain's proposed buyout, please click on [ID:nN15376794].