New York-listed communications vendor Avaya is bound for private hands after inking a definitive merger agreement with two private equity firms.
Silver Lake and TPG Capital have fought off a long list of contenders believed to include Cisco and Nortel to land Avaya in an $8.2bn deal. Avaya posted revenues of $1.29bn in its fiscal second quarter, up 4.5 per cent year-on-year.
Rumours surfaced last week that the vendor was up for sale after it postponed its annual Wall Street analysts’ meeting (CRN, 4 June).
Phil Odeen, non-executive chairman of Avaya’s board of directors, said: “After an extensive review of Avaya's strategic alternatives with Avaya management and our financial advisors, the board of directors of Avaya determined that this transaction with Silver Lake and TPG provides the best value for Avaya's shareholders.”
Avaya said it expected the merger to close in the autumn, but stressed that the agreement allows it to solicit proposals from third parties for the next 50 days,
David Roux, a co-founder and managing director of Silver Lake, said: “We have full confidence in Avaya's excellent management to build on the company's remarkable technology and history, which spans more than a century, to deploy advanced IP communications solutions as a source of competitive advantage for customers.”
John Marren, a partner of TPG, said: “As one of the earliest private investors in technology and telecommunications, TPG has come to know and admire Avaya for its roster of leading customers, history of product innovation and commitment to customer service.”
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