Plans by Huawei Technologies, the mainland's largest wireless equipment provider, to become the second-largest shareholder in 3Com Corp may face a national security investigation by the United States government. 3Com, a Nasdaq-listed network equipment maker that posted an US$18.7 million loss in the three months to August, revealed last Friday that it had agreed to a takeover proposal by private investment firm Bain Capital and Huawei for US$2.2 billion. Huawei would take a 16.5 per cent stake. The US would probably probe the deal on national security grounds, the Financial Times said on Saturday, citing former Justice Department official Christopher Simkins. The US Committee on Foreign Investment looked closely at any mainland transactions involving government information technology, the newspaper said. Huawei's ownership of 3Com would be 'really worrisome', the Financial Times quoted Pentagon internet security expert Sami Saydjari as saying. 'It is premature to comment on the outcome of any review by the US government,' said Ross Gan, a spokesman at Shenzhen-based Huawei. The deal would probably succeed as 3Com had not launched any pioneering technology in the past decade, said Charles Mok, an ex-officio member of the Hong Kong Information Technology Federation, a trade association. The deal, which is expected to be closed in the first quarter of next year, ranks as the sixth-largest buyout of a technology company this year. 'This is a commercial investment for Huawei,' Huawei chief executive Ren Zhengfei said. 'We believe the new ownership structure will help 3Com to improve its business operations, provide better products and services and bring more value to its customers.' Jonathan Zhu, a Bain Capital managing director based in Hong Kong, said: '3Com has a strong competitive position, and we believe there are significant opportunities to grow by acquiring customers and introducing new products.' Mr Zhu said Bain Capital was interested in having Huawei as a strategic partner as the mainland company had played an instrumental role in establishing and expanding Huawei-3Com Technologies (H3C). 'The continued involvement of Huawei will bring significant benefits,' he said. Privately held Huawei in 2003 formed H3C, a 51-49 joint venture, with 3Com. In 2005, it sold a 2 per cent stake in the joint company to 3Com for US$28 million. In November last year, 3Com won the right to acquire the remaining 49 per cent stake for US$882 million through a bidding process and received the final approval from the central government in March this year. H3C is based in Hong Kong. It has about 4,800 employees, including 2,500 engineers, most of whom are based in Beijing, Hangzhou and Shenzhen.