3Com (COMS) For Sale

July 18, 2007 by Douglas A. McIntyre

It appears that private equity interests are about to take 3Com (COMS) off the market. Silver Lake Partners and Bain Capital have apparently stopped by.

As The Wall Street Journal points out: "the story of 3Com in the past 10 years is one of missed opportunities." The company’s shares traded for $9 in early 2004. They now change hands at just over $4.

3Com has lost money each of the last three years, and each of the past four quarters. In the last reported period, the company lost $9 million on revenue of $323 million.

Aside from being poorly managed, the company now competes with Cisco (CSCO) in almost all of its core markets. The company has had three CEOs in the last two years.

What private equity sees in 3Com is a mystery. It may simply be a matter of too much money going after too few deals.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com.