3Com Wants Penalty from Bain for Abandoned Takeover Deal

3/21/08

Last month Boston’s Bain Capital and Chinese investment partner Huawei Technologies withdrew their petition with the Committee on Foreign Investment in the United States for permission to take over Marlborough, MA-based 3Com in the face of the committee’s security concerns over partial Chinese ownership of 3Com, whose TippingPoint subsidiary makes security software used by the U.S. government. Yesterday, Bain gave up entirely on the deal, the Boston Globe and other outlets are reporting. And today 3Com announced it would squeeze Bain for a $66 million breakup penalty payment, saying the investment firm’s reasons for pulling out of the deal were “invalid” and “not grounds for termination.”

Wade Roush is a contributing editor at Xconomy. Follow @

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