Huawei Technologies could soon be making inroads into the United States.
According to multiple reports, the China-based maker of low-cost telecom equipment, is bidding for a Sprint Nextel Corp. contract. Sprint, a U.S.-headquartered mobile service provider, is working to expand its wireless broadband network.
If Sprint chooses to do business with Huawei, such a deal would require approval from the United States government, the Financial Times reported. That’s due to security concerns about China having too much access to communications networks in the United States, allowing for economic espionage – Huawei founder Ren Zhengfei once served as an engineer for the People’s Liberation Army. Indeed, Huawei, the second-largest gear-maker in the world, had to give up a takeover bid for network vendor 3Com Corp. in 2008 over those same fears.
More recently, the industry rumor mill has speculated Huawei might try to buy struggling Alcatel-Lucent, something Huawei has denied. Alcatel-Lucent is based in Paris, as well as in New Jersey, so any such transaction would be subject to a U.S. go-ahead.
Huawei wouldn’t comment on the validity of the Sprint-bid speculation, although a spokesman did tell Reuters the company “always” bids for contracts in the United States. If Huawei wins Sprint business, analysts who spoke with Reuters said that could help clear the way for at least one significant Huawei acquisition in the United States.
