致用商务英语阅读programme nie Counteroffer.ppt

A spokesman with Huawei yesterday confirmed the counteroffer is in the pipeline but declined to reveal details. Huawei’s counteroffer followed a bid by 3Com to buy the stake owned by Huawei in H3C on November 17. Under a shareholder agreement, Huawei’s counteroffer could be at least 2 per cent higher on a per-share basis than the offer made by 3Com. “I believe Huawei has a very clear intention to pull out of H3C,” said Wang Yuquan, an analyst with research firm FrostSullivan China. “Currently, H3C is not a strategic priority for Huawei.” H3C was established in November 2003 with Huawei taking a 51 per cent stake and 3Com owning the remaining. In October 2005, 3Com signed a deal to buy an additional 2 per cent stake from Huawei for US$ 28 million, which helped 3Com take a controlling stake in H3C. The deal was completed in February. The establishment of H3C was designed to help Huawei expand its business overseas. US-based Cisco Systems in January 2003 launched a lawsuit in a US court against Huawei, accusing the latter of infringing upon its patents in computer-networking technologies. The lawsuit put a temporary brake on Huawei?s overseas expansion. The forming of H3C was believed to have provided a shortcut to Huawei in its overseas expansion. In June, Huawei signed a deal to buy its smaller domestic rival Harbour Networks, founded by some former Huawei executives. The deal has largely undermined H3C?s importance for Huawei as Harbour and H3C have almost similar product portfolios. But H3C is crucial to 3Com as the joint venture contributes a large portion to the US firm’s global revenues. According to H3C’s website, the firm’s year-on-year sales revenue growth was more than 70 per cent during 2004-2006. Net sales revenue for the first half of this year totalled US$324 million. Huawei’s counteroffer could help the firm increase its bargaining power in negotiations with 3Com. If Huawei sells out of H3C it