Hewlett-Packard will sell a controlling 51% stake in its China-based data networking business to China's Tsinghua Unigroup for at least $2.3 billion, forming a partnership designed to create a Chinese technology powerhouse.
State-backed Tsinghua Holdings' subsidiary Unisplendour will acquire 51% of HP's H3C Technologies for at least $2.3 billion, Unisplendour said in a statement to the Shenzhen stock exchange late yesterday.
The US company said in a statement it will form a partnership with Tsinghua Holdings, affiliated with China's elite Tsinghua University, to create a group in China to house H3C's networking operation alongside its China-based server, data storage and technology services businesses.
HP said in its statement it valued its H3C business at $4.5 billion. The company had previously valued the unit at $5.5 billion, people with knowledge of the matter told Reuters last month.
Western tech companies have struggled for customers in China after former US National Security Agency contractor Edward Snowden's revelations of cyber-spying programmes involving US firms. Many of these western companies are now seeking local partners or selling off assets altogether to Chinese buyers.
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