Mitel has entered into a deal to pay $1.98bn for conferencing firm Polycom. The companies said that the arrangement will create a new industry leader, and that Polycom will retain its name but operate entirely under Mitel’s management.
Polycom's directors will join the Mitel board, and the firm will have 7,700 employees when the acquisition is closed. The fate of Polycom CEO Peter Leav is not clear, however, although he described the deal as a good move for the firm.
"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,” he said.
The purchase was orchestrated by Elliott Management Corp, which owns major stakes in both firms, according to Bloomberg, and was keen to see a consolidation of assets and increase in market power to boost the value of the investments.
Mitel CEO Rich McBee played up these potential benefits. "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," he said.
"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."
The deal is expected to close in the third quarter of 2016, subject to the usual regulatory requirements.
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