Beijing - Hewlett-Packard Co (HP) has agreed to dispose a controlling 51 percent stake in its network business based in China. China's Tsinghua Unigroup's parent company spokesperson confirmed the deal on Tuesda, which is estimated to be worth over 1 billion pounds ($2 billion).

Tsinghua Holdings, backed by the state, controls Tsinghua Unigroup. Li Zhongxiang, the spokesman for the parent company failed to disclose the exact value of the deal. Nonetheless, he said that he expected the deal to sail through very soon. According to a source close to the matter, an announcement could come through as soon as this coming Thursday.

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HP spokesman based in Singapore refused to comment on the issue. If this deal materializes, Unigroup would have pipped the China Huaxin Post and Telecommunication Economy Development Center. The company had also sought to buy HP's unit - that makes switches and routers for corporate clients. HP is yet to offer any communication to Huaxin about the decision.

These details were revealed according to the Shanghai-based firm's spokesman. It is expected that the routers and the switches unit would also be soon in Tsinghua Unigroup's kitty after the present deal goes through, according to Market Watch.

Under the Chinese regulations, the NDRC (National Development and Reform Commission) must approve verify and approve all outbound investments that are worth over 1billion pounds. The NDRC also has to approve outbound investments that are in sensitive industries.

Previously, HP had valued its unit, H3C Technologies Co, to be $5.5 billion. Close sources revealed to Reuters that approximately 10 Chinese prospective buyers were courting HP, as per reports by WSJ.

In the recent past, both Huaxin and Unigroup have sealed huge cross-border technology deals. For instance, Huaxin bought 85 percent stake in Alcatel-Lucent'ts computing business. Unigroup on the other hand, invested $1.5 billion in Intel Corp.

Most western companies are currently selling off assets or seeking local partners in China.

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