Mainland telecommunications equipment supplier UTStarcom will pay US$100 million for assets belonging to United States computer-network equipment maker 3Com, in a move aimed at expanding its business overseas.
Under the deal UTStarcom will pay cash to acquire selected assets of 3Com's CommWorks, including equipment, contracts, agreements, licences and leases.
CommWorks provides carrier-focused voice and data products. The deal is expected to close within two to four months.
The Nasdaq-listed wireless and wireline access equipment supplier hopes the acquisition will reduce its dependence on the China market.
'Acquiring the Commworks assets will allow UTStarcom to add to its base of tier-one customers and accelerate its geographic diversification outside of China,' president and chief executive Hong Lu said.
He said the CommWorks client list will give UTStarcom access to blue-chip customers around the world.
UTStarcom earns about 84 per cent of its revenue from selling network equipment and handsets to run citywide mobile phone services - known as xiaolingtong, or 'Little Smart' - on the mainland.