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Network World - Rumors that 3Com might be bought by private investors caused the network company’s stock to jump this week.
Reports yesterday said that an unnamed private equity group is targeting the network company, and is willing to pay as much as $7 per share. 3Com stock, which has traded between $3.47 and $5.70 for the past 52 weeks, closed at $5.02 after lots of trading, reports said.
The jump was triggered by a report from UBS stock analyst Long Jiang that indicated 3Com’s recent efforts to shore up majority ownership in its joint venture with Chinese equipment maker Huawei could make the network company more valuable. 3Com has a 51% joint venture stake in the Chinese company.
3Com made $300 million in revenue for first fiscal quarter of 2007 (which ended in September), a 69% increase from the same quarter a year ago. (This was the first time 3Com included results from its joint venture with Huawei, which makes many of 3Com’s large-enterprise network hardware products).
3Com in August appointed Edgar Masri as its CEO, replacing Scott Murray, who stepped down after less than eight months on the job. (Murray replaced Bruce Claflin, who announced his retirement in January).
3Com had no comment on the rumors regarding the potential buyout. “It would be silly to guess why [3Com] stock goes up or down a few points on any given day,” says a company spokesman.
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