Huawei founder Ren Zhengfei denies involvement with Nortel collapse

by Nathan VanderKlippe Asia correspondent

As a Canadian technology giant neared collapse, its fast-rising Chinese competitor moved in, ready to buy what was left of the company it was about to trounce.

Huawei was still a little-known Chinese manufacturer of communications equipment in 2009, when Nortel was in the midst of bankruptcy proceedings. Only later would Nortel’s former security adviser accuse Huawei of benefiting from years of Chinese hacking into the Canadian company’s systems and stealing confidential information.

But sometime in Nortel’s final chapter, Huawei offered to take it over, the Chinese company’s founder, Ren Zhengfei, told The Globe and Mail in an interview.

“I told Mike that I wanted to acquire Nortel,” Mr. Ren said, referring to Mike Zafirovski, the man who was then Nortel’s chief executive officer.

The deal did not happen, Mr. Ren said, because Mr. Zafirovski “replied by saying that he wanted to be the controlling shareholder of Huawei,” Mr. Ren said. “Nortel was already going into bankruptcy, but they still insisted on taking a controlling stake in Huawei.”

The Chinese executive recalled asking, “Where will you get the money?” Nortel filed for bankruptcy protection on Jan. 14, 2009.

Mr. Zafirovski said “he could go out looking for money,” Mr. Ren recalled. “I said it’s impossible.”

Mr. Zafirovski did not respond to multiple requests for comment. And it’s not clear whether any such takeover could have been approved.

“I don’t think any approach from Huawei would have been taken very seriously. The U.S. government was too important as a customer,” said John Manley, the former Canadian deputy prime minister who also served on the Nortel board. Mr. Manley did not recall any specifics of a Huawei proposal.

The idea that Huawei sought to acquire the collapsing remains of Nortel is also likely to be seen as bittersweet by those who lay blame for the disintegration of the Canadian telecommunications champion partly at the feet of Chinese intellectual property theft. Brian Shields, Nortel’s former security adviser, has said internet logs show hackers from China had access to Nortel’s systems for years, at a time Huawei was rapidly developing some similar products.

full story at https://www.theglobeandmail.com/world/article-huawei-founder-ren-zhengfei-denies-involvement-with-nortel-collapse/