Mitel Networks Corp. is buying Inter-Tel Inc. for $723 million in cash, the companies said Thursday.
Privately held Mitel will pay $25.60 per share for the Tempe, Ariz.-based company and said the merger will double its annual revenue to $800 million. Inter-Tels closing price on Thursdays NASDAQ was $23.79.
Mitel CEO Don Smith said the Canadian company would withdraw its initial public offering as a result of the deal.
The companies said the merger will allow them to extend their reaches with SMBs and expand into the large-business IP communications market. The combined company, including Inter-Tel international subsidiaries, such as Inter-Tel Europe, Swan Solutions and Lake Communications, will have operations in more than 90 countries.
Mitel and Inter-Tel have products in unified communications, networking, management and applications such as messaging, contact centers, mobility and collaboration.
The boards of both companies have approved the transaction, which is subject to the approval of Inter-Tel stockholders and other closing conditions and regulatory approvals. The transaction is expected to close in the third quarter.
Morgan Stanley and Genuity Capital Markets were financial advisers for Mitel. UBS Investment Bank was the financial adviser for Inter-Tel.
Inter-Tel Inc. www.inter-tel.com
Mitel Networks Corp. www.mitel.com