Shanghai Daily reports:

BAIN Capital Partners’ US$2.2 billion acquisition of 3Com Corp is expected to be finalized by the end of the first quarter, though the deal is being investigated by the US regulator because of a Chinese firm’s involvement, the US-based private investment firm said yesterday.

…”It is just a deal between two US companies and many steps can be taken to avoid a ‘China connection’ to the 3Com’s sensitive clients,” said Jing Huang, Bain Capital’s managing director, who was attending the China Venture Capital Annual Forum 2007 in Shanghai.

…Huang expected the deal to be finalized by March and Huawei to get approval to be involved.

I’m not sure what those “many steps” would be. The sale is being reviewed by the Committee on Foreign Investment in the United States (CFIUS) to assess whether or not there any implications for national security. 3Com’s Tippingpoint security solution is widely used in the US government.

It seems that the review has gone into a second phase, as the initial 30 day review period has passed. That means there are enough questions about the sale to merit further investigation.

Any easy step for Bain would be to sell Tippingpoint.

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