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3Com-Huawei joint venture begins operations

By , IDG News Service
November 17, 2003 01:38 PM ET

IDG News Service - A joint venture between 3Com and Huawei Technologies has received approval from the Chinese government and began operations Monday.

Huawei-3Com Co. Ltd. will sell enterprise-class routers and Ethernet LAN switches in China and Japan, and 3Com has rights to market the same Huawei-3Com products in all other countries. The green light for the joint venture by the Chinese government follows approval by the U.S. and U.K. in July. The two companies announced their plans for the joint venture in March.

"We're fully operational today," said Karin Bakis, a 3Com spokeswoman.

Huawei, based in Shenzhen, China, is contributing its enterprise networking business assets to Huawei-3Com, including LAN switches and routers, engineering and sales/marketing resources and personnel, and licenses to its related intellectual property, according to 3Com.

3Com is contributing $160 million in cash, assets related to its operations in China and Japan, and licenses to some intellectual property. In two years, 3Com has the right to acquire a majority ownership interest in Huawei-3Com.

Principal operations for the joint venture are in Hangzhou, China.

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