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Mitel to Acquire Polycom for Nearly $2 Billion

Merger

**Editor’s Note: Please click here for a recap of the biggest channel-impacting mergers in Jan.-Feb. 2015.**

Mitel announced Friday that it will acquire Polycom for approximately $1.96 billion in cash and stock.

In a release, Mitel cited a period of intense change – and competition – in the communications and collaboration industry as vendors infringe on one another’s traditional turf and startups seek to redefine collaboration. Execs say the combined company will leverage Mitel’s global communications business to advance Polycom’s conference and video collaboration portfolio.

The combined company will be headquartered in Ottawa, Canada, and will operate under the Mitel name while maintaining Polycom’s brand. Richard McBee, Mitel’s CEO, will lead the combined organization. Once merged, the company will have a global workforce of approximately 7,700 employees.

“Mitel has a simple vision — to provide seamless communications and collaboration to customers,” said McBee in a statement. “To bring that vision to life we are methodically putting the puzzle pieces in place to provide a seamless customer experience across any device and any environment.” {ad}

“Together, Polycom and Mitel expect to drive meaningful value for our shareholders, customers, partners and employees around the world,” said Peter Leav, president and CEO of Polycom, which is based in San Jose, Calif. “We look forward to working closely with the Mitel team to ensure a smooth transition and continued innovation to bring the workplace of the future to our customers.”

The companies also praised their “impressive ecosystem of partners.”

Combined, the two count more than 82 percent of Fortune 500 companies among their customer base, along with a combined portfolio of more than 2,100 patents and more than 500 patents pending. The deal, expected to close in 2017, will create a new $2.5 billion revenue company.

As we reported in October, activist investor Elliott Management Corp. has reportedly been pushing the companies to team up, to compete better with not only UC offerings from Cisco and Avaya but new challengers in the space, like Microsoft and Slack.

Vince Bradley, CEO of master agent WTG, told Channel Partners when the idea of a merger was floated that Mitel’s growing engagement with the services side of the channel makes it an attractive pick.

“Because frankly, I have been surprised that Polycom hasn’t already tapped our space,” Bradley said.

Follow editor-in-chief @LornaGarey on Twitter.


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