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Mitel buys Polycom for $1.96B in enterprise communications consolidation play

TechCrunch TechCrunch 15/04/2016 Ingrid Lunden

As more enterprises move their communications services over to IP networks and cloud-based services, we’re seeing an increasing amount of consolidation as the businesses that serve them continue to grow to provide end-to-end services. Today comes that latest move in that sphere: Mitelannounced that it would acquire Polycom in a cash-and-stock deal valued at $1.96 billion, creating a company with a total market cap of $2.5 billion and 7,000 employees.

Polycom, based out of San Jose, will continue to keep its branding, Mitel said, with the overall company headquartered in Ottawa, Mitel’s current HQ. Both companies are publicly traded and have been acquirers of smaller companies themselves, but not on the prolific level of some of their competitors like Cisco. This is only Mitel’s fifth acquisition, according to Crunchbase.

“Mitel has a simple vision – to 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 in a statement. “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.”

Both companies compete against the likes of Cisco and Avaya. Mitel is perhaps best known for its IP telephony solutions, including PBX systems, while Polycom is a leader in conferencing services. They also cover SIP technology, and customers span 82% of Fortune 500 companies.

The companies have been in negotiations for nearly 10 months, Mitel said.

More to come.

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