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Thu, May 01, 2008 - Page 10 News List

3Com bases new CEO in China

BETTER POSITIONED Robert Mao, who has worked in China for Nortel Networks, will oversee 4,000 employees in the growing market for 3Com’s switches and routers


Edgar Masri has been removed as chief executive of data network equipment maker 3Com Inc and immediately replaced by Robert Mao (毛渝南), a fluent Mandarin speaker who will be based in China, which the Massachusetts-based firm sees as its biggest market.

The management shuffle comes a month after a proposed US$2.2 billion buyout of 3Com was scuttled because of concern over a Chinese company’s role. The change also brings in Ronald Sege to the new position of chief operating officer and as president of the company, effective as of yesterday.

Eric Benhamou will remain chairman of 3Com’s board, company spokesman Kevin Flanagan said.

Mao, 64, who became 3Com’s executive vice president for corporate development in August 2006, left seven months later, though he retained a spot on 3Com’s board.

“It was a decision by the board of directors to make a change in the senior executive area and essentially they decided to replace Edgar Masri with Bob Mao as our CEO, with Ronald Sege as our president and COO,” Flanagan said.

Mao, who has worked in China for Nortel Networks, will oversee 4,000 employees in China, a growing market for 3Com’s switches, routers and other gear to help data networks run efficiently.

“We’ve got the majority of our employees in China and a very large piece of our revenue,” Flanagan said.

Sege, 51, most recently president and CEO of Tropos Networks Inc, a wireless broadband network provider, will focus on 3Com’s operations outside China. He’ll work from company headquarters in the Boston suburb of Marlborough, home to about 400 of the company’s global work force of about 6,000.

The management changes were announced after trading closed, with shares of 3Com up US$0.04 at US$2.34.

Masri, who was president and CEO from 2006 until Tuesday, announced a proposal in September for Boston-based private equity firm Bain Capital Partners to lead a buyout of 3Com.

He said that the deal would help 3Com gain freedom from the whims of the market and improve its chances of expanding in China.

The deal would have given Huawei Technologies (華為), China’s largest maker of telecommunications equipment, a minority stake in 3Com — a prospect that raised the ire of US lawmakers afraid that sensitive military technology would be transferred to China.

3Com’s stock rose 34 percent the day the deal was announced but declined after the concerns arose. Bain and 3Com then failed to agree on ways to restructure the deal to address lawmakers’ fears.

Bain cited the national security issues in announcing last month that it was giving up on the deal.

3Com’s Flanagan said Masri’s ouster had “absolutely nothing to do with” the failed buyout.

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