Mitel Purchases Polycom for 1.96 Billion
Mitel (MITL) has purchased conference solution and video collaboration provider Polycom (PLCM) for $1.96 billion, the company announced on Friday.
The acquisition brings together two of the biggest names in the enterprise communications space and puts Mitel one step closer to achieving its goal of becoming the market leader in enterprise communications and collaboration.
The combined company will operate under the Mitel name, but will retain Polycom’s branding for its conference solution and video collaboration portfolio, according to the announcement. Mitel CEO Richard McBee will lead the company from its Ottowa headquarters, while Steve Spooner, Mitel’s chief financial officer, will continue in his current role.
“Polycom is one of the most respected brands in the world and is synonymous with the high quality and innovative conference and video capabilities that are now the norm of everyday collaboration,” said McBee, in a statement. “Together with industry-leading voice communications from Mitel, the combined company will have the talent and technology needed to truly deliver integrated solutions to businesses and service providers across enterprise, mobile and cloud environments.”
Polycom directors are expected to assume two seats on the Mitel board once the merger is completed. Mitel said it will have approximately 7,700 employees after taking on Polycom’s workforce.
Current Polycom stockholders will receive $3.12 in cash and 1.31 common shares in Mitel for each share of Polycom stock, which equates to $13.68 based on the April 13 closing price, according to the announcement.
The deal is expected to close during the third quarter of FY 2016 once final approval from stockholders has been received.
It remains to be seen just how large an impact Mitel’s acquisition of Polycom will have on the overall enterprise communications market, but the deal will certainly be one to watch in the following months as more details emerge. The Polycom deal is one of several major acquisitions Mitel has made in the past two years, following its purchase of Mavenir for $560 million in 2015 and its purchase of Aastra Technologies for C$392 million in 2014.