Mitel and Aastra to Merge, Creating a Billion Dollar Company

Mitel Also Announces Aggressive SMB Strategy for MiVoice Office Solution

Big news coming from Mitel and Aastra this week as the two companies have announced plans to merge. Their combined revenues will company with US $1.1 billion in revenues – including a US$100 million cloud business,  2500 channel partners, and a global customer base of 60 million end users.   

Under the terms of the agreement, Mitel will acquire all of the outstanding Aastra common shares for a total value to Aastra shareholders of CAD$392M, representing a 20.9% premium based on a 30-day volume weighted average price of Aastra common shares as of November 8, 2013. The combined company will be headquartered in Ottawa, Canada and will operate under the name Mitel while continuing to leverage Aastra's strong brand recognition in select European markets.

The executive management team be led by current Mitel President and CEO Richard McBee. Reporting to McBee will be Chief Financial Officer, Mr. Steve Spooner, and Aastra's Co-CEOs, Mr. Francis Shen, who will assume the position of Chief Strategy Officer, and Mr. Tony Shen, who will assume the position of Chief Operating Officer.

Commenting in a statement on the merger, McBee said, "The business communications market is ripe for consolidation and on the cusp of a mass migration to cloud-based services. We believe that small competitors with narrow focus and limited global reach will quickly be marginalized." He added, "Aastra's solid financial structure, complementary portfolios, geographic reach, and large installed-base immediately augment and expand Mitel's market footprint, enabling us to capitalize on a unique opportunity to leap-frog the competition and lead the market."

The transaction is subject to customary closing conditions customary in transactions, with plans for completion in the first quarter of 2014.

In other product-related news from Mitel, the company announced last week that it aggressively positioning its MiVoice Office solution with competitive new pricing. Mitel MiVoice Office is a unified communications platform supporting up to 250 users and more through networking to support multiple sites. The out-of-the-box solution includes features such as unified voice messaging, audio conferencing,  hot desking, and teleworker support.

Mitel Chief Marketing Officer, Martyn Etherington, commented in a statement saying "Customers come first at Mitel, and that includes our SMB, midmarket and enterprise customers. While we are baffled by competitors that are killing off entire product lines and retreating from the SMB and midmarket, Mitel is happy to welcome their customers with MiVoice Office, offering more functionality for less."

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