Polycom has struck a deal to be acquired by private-equity firm Siris Capital for $2 billion, abandoning its previously announced agreement with Mitel.
The two vendors have become key forces in the unified communications and collaboration market segment. Mitel provides a series of traditional and IP-based PBX and cloud-based products, while Polycom is known as a provider of voice and video conferencing solutions.
Siris Capital will acquire Polycom for $12.50 per share, or about $2 billion, including the assumption of existing debt. Sidley Austin LLP advised Siris on the acquisition.
Investors embraced Siris Capital's proposal as Polycom's shares jumped 13.1 percent to $12.30 in pre-market Friday morning trading on the Nasdaq stock exchange.
When Mitel announced its intent to acquire the company in April, Polycom stockholders were line to receive $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.
Now that it has accepted Siris' proposal, Polycom will pay Mitel a $60 million termination fee.
Mitel said it would not raise its offer for Polycom and waived its right to match Siris' offer.
Polycom, according to a WSJ report received an offer from another unnamed private-equity firm. After receiving a higher offer on June 7, Mitel said it would not change its initial acquisition proposal. Polycom is canceling its special stockholder meeting that was to vote on the merger with Mitel.
After meeting necessary regulatory, shareholder approvals and other customary closing conditions, Siris said it expected to close the acquisition of Polycom in the third quarter.
Activist shareholder Elliot management helped broker a deal between Mitel and Polycom in 2015 as a way to scale their operations to gain further share in the unified communications and collaboration segments.
Mitel has been actively enhancing its portfolio via acquisitions. Previously, the Canadian vendor purchased Corvisa and Mavenir, two deals that enhanced its UC cloud and enterprise collaboration capabilities.
For more:
- WSJ has this article
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Updated July 11 to include Sidley Austin involvement.