Mitel has signed a definitive arrangement agreement to be acquired by an investor group led by affiliates of Searchlight Capital Partners, in an all-cash transaction valued at approximately US$2 billion.
Terms of the deal will see the business communications specialist become a privately held company, in a bid to accelerate cloud ambitions across the market.
With the transaction expected to close during the second half of 2018, subject to customary closing conditions, shareholders will receive US$11.15 per common share in cash.
“Mitel has succeeded for 45 years because of persistent innovation and relentless focus on delivering shareholder value,” Mitel co-founder and chairman, Terry Matthews, said.
“Our board determined that this transaction, upon closing, will deliver immediate, significant and certain cash value to our shareholders.
“It also affirms the tremendous value and market leadership of Mitel. We believe this transaction will provide Mitel with additional flexibility as a private company to pursue the company’s move-to-the-cloud strategy.”
Based in New York, Searchlight is a private equity firm with investments in markets across North America and Europe, including tech giant Rackspace.
From a strategic perspective, the company seeks out partnerships with corporations and businesses in which capital and strategic support can enhance value.
“This transaction is an exciting next step in our multi-year transformation that has enabled Mitel to emerge as an industry leader in the largest markets in the world,” Mitel CEO, Rich McBee, added.
“As a private company, and with the strategic and capital support of the Searchlight funds, we will have greater flexibility to manage the transition in our market, accelerate our strategy, and drive the next phase of success for our customers, partners, and employees.”
The acquisition follows a rollercoaster two years for the vendor in the mergers and acquisitions market, having first failed to acquire the assets of Polycom in July 2016.
As reported by ARN, Polycom dramatically pulled the plug on Mitel’s proposed US$1.9 billion acquisition of the company, scrapping the deal to go private instead.
Following a tense day of deliberating at the video conferencing vendor, over a years' worth of negotiating was off the table after the company accepted a rival US$2 billion bid from Siris Capital Group LLC, a private equity firm based in New York.
But Mitel bounced back, acquiring ShoreTel in July 2017 to create a unified communications giant.
As reported by ARN, the US$530 million deal is designed to drive growth across the unified communications-as-a-service (UCaaS) market, with the acquisition seeing the vendor become the second largest player in the industry.