3Com asks for US$66 mln from Bain for failed merger plan

3Com, the U.S. manufacturer of computer network infrastructure products, has demanded US$66 million from PE firm Bain Capital, who has abandoned the US$2.2 billion takeover plan of the former last Friday, sources reported.

Bain Capital joined hands with China's Huawei for a takeover of the network vendor last September, and an agreement has been signed in October, under which 3Com will be acquired at US$5.3 per share.

The deal, if successful, will allow Bain Capital and Huawei to hold 83.5% and 16.5% stake respectively in 3Com, and the Chinese company has the option to buy 5% more in future.

However, the U.S. Committee on Foreign Investment said they might block the deal due to national security concerns.

Bain claims it pursued all avenues to see the merger go ahead, but felt it could not get the agreement approved by the regulator.

However, 3Com said in a statement that it would fight for a break-up fee as it thought Bain's termination of the merger agreement was not valid.