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Mitel Networks: Ottawa And San Jose, April 15, 2016

The following excerpt is from the company's SEC filing.

Mitel (Nasdaq: MITL) (TSX: MNW) and Polycom (Nasdaq: PLCM), today announced that they have entered into a definitive merger agreement in which Mitel will acquire all of the outstanding shares of Polycom common stock in a cash and stock transaction valued at approximately $1.96 billion. Under the terms of the agreement, Polycom stockholders will be entitled to $3.12 in cash and 1.31 Mitel common shares for each share of Polycom common stock, or $13.68 based on the closing price of a Mitel common share on April 13, 2016. The transaction represented a 22% premium to Polycom shareholders based on Mitels and Polycoms unaffected share prices as of April 5, 2016 and is expected to close in the third quarter of 2016, subject to shareholder and regulatory approvals and other customary closing conditions.

New company with shared vision for seamless communications and collaboration

The communications and collaboration industry is undergoing a period of intense change that is rapidly redrawing the competitive landscape and breaking down barriers between previously discrete markets and technology domains. Through a series of strategic acquisitions, Mitel has successfully capitalized on changing market dynamics and transformed the company to help customers operate more efficiently and cost effectively. The combination of Mitel and Polycom will create a new industry leader leveraging Mitels recognized leadership as a pioneer in global communications with Polycoms well-known premium brand and industry-leading portfolio in the conference and video collaboration market.

The combined company will be headquartered in Ottawa, Canada, and will operate under the Mitel name while maintaining Polycoms strong global brand. Richard McBee, Mitels Chief Executive Officer will lead the combined organization. Steve Spooner, Mitels Chief Financial Officer, will also continue in that role. On the closing of the proposed transaction, it is expected that Polycom directors will assume two seats on the Mitel board. Once merged, the combined company will have a global workforce of approximately 7,700 employees.

Mitel has a simple visionto provide seamless communications and collaboration to customers. 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, said Mitel CEO Rich McBee. 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. 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.

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. 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.

Global scale and strategic scope provide key customer benefits

The combined global company will offer customers an integrated technology experience supported by an impressive ecosystem of partners. Key market positions include:

#1 in business cloud communications

#1 in IP/PBX extensions in Europe

#1 in conference phones

#1 in Open SIP sets

#2 in video conferencing

#2 in installed audio

Installed customer base in more than 82% of Fortune 500 companies

Deep product integration with Microsoft solutions

Mobile deployments in 47 of the worlds top 50 economies

Combined portfolio of more than 2,100 patents and more than 500 patents pending

Global presence across five continents with approximately 7,700 employees worldwide

Enhanced platform expected to deliver profitable growth with opportunities for synergies and significant debt deleveraging

The combined company will have a significantly larger financial platform with the scope, scale and operating leverage needed to strategically expand in an actively evolving market. Financial highlights of the transaction include:

Diverse revenue base with pro forma 2015 sales of approximately $2.5 billion

Strong cash flow generation with pro forma 2015 EBITDA of approximately $350 million

Strengthened balance sheet with Mitels pro forma 2015 net debt leverage reduced from 3.8x to 2.1x

Expected to be accretive to Mitel shareholders in 2017

Anticipated operating synergies of approximately $160 million by 2018, driven by supply chain optimization, facilities consolidation and economies of scale


Source: Synergy Research Group, March 2016

Source: MZA Limited, March 2016

Source: Frost & Sullivan, Global Audio Conferencing Endpoints, November 2015

Source: Synergy Research Group, September 2015

Source: Q4 2015 UC Market TrackerTelepresence Market Share Data Reports, February, 2016

Transaction Details

Each of Mitels and Polycoms Boards of Directors have unanimously approved the transaction and are resolved to recommend that its shareholders vote in favor of the transaction. Mitels directors and executive officers, as well as Kanata Research Park and funds managed by Francisco Partners, have entered into voting agreements with Polycom to vote their respective Mitel common shares in favor of the transaction. Polycoms directors and executive officers have entered into voting agreements with Mitel to vote their respective shares of Polycom common stock in favor of the transaction. In addition, Elliott Management has entered into voting agreements with each of Mitel and Polycom to vote its Mitel common shares and its shares of Polycom common stock in favor of the transaction.

The transaction is expected to close in the third quarter of this...