Hewlett Packard Enterprise (HPE) says Chinese vendor Huawei could benefit if its $14 billion acquisition of Juniper Networks is blocked.
In the company's response to the US Department of Justice (DOJ), which last month filed a complaint in opposition to the deal, HPE warned that Cisco, along with Huawei could benefit at its expense.
The DOJ's complaint, filed on January 30, argues that the planned acquisition poses a threat to competition for enterprise Wireless Local Area Network (WLAN) used by large companies, universities, and hospitals.
"If consummated, [the deal] would eliminate head-to-head competition that has lowered prices and driven investment in network management software, and it would decrease pressure on HPE to discount and innovate in the future,” said the DOJ in its filing last month.
Both HPE and Juniper said at the time that the DOJ's views to block the deal were "fundamentally flawed."
In HPE's response this week, the company said that the DOJ's complaint "ignores both the extensive benefits that will result from the proposed acquisition and the nature and extent of competition in the wireless networking space."
"It is a complaint that will reinforce the status quo by benefiting Cisco, which has dominated wireless networking for decades (and whose dominance was threatened by the acquisition); a complaint that will hobble competition with Huawei - which has been repeatedly identified as a national security risk by the US government - and thus damage the US’s stated aim of reducing the use of Chinese technology in critical infrastructure globally," said HPE.
In the response, HPE goes on to cite a Gartner report that highlights eight WLAN providers; Arista, Cisco, Extreme, Fortinet, Juniper, HPE, Huawei, and Ruckus as competitors in this field, noting that its deal to acquire Juniper won't harm the landscape.
HPE announced an agreement to acquire network gear maker Juniper Networks last January, a move that received the backing of both companies' boards. Months later the UK's Competition and Markets Authority (CMA) also approved the deal.
However, the US has taken a different stance on the deal, with the antitrust lawsuit the first to be filed under President Donald Trump's administration.
Founded in 1996 and based in Sunnyvale, California, the New York-listed Juniper provides networking products, including routers, switches, network management software, network security products, and software-defined networking technology.
