Mitel drops IPO price

Vendor to raise about $150m from upcoming flotation, but $14-a-share price is way below previous estimate

Sharing the spoils: Mitel could make almost $150m from its IPO

Comms vendor Mitel's initial public offering (IPO) is to price the 10 million-plus available shares significantly lower than expected.

The vendor, which will be listed on the NASDAQ Global Market, is to sell about 10.5 million company-owned shares at a price of $14 (£9.10) each. This will potentially raise almost $150m, but the share price is well short of the $18-20 Mitel projected last month.

The IPO is being made through an underwriting syndicate, headed by Bank of America Merrill Lynch, JP Morgan and UBS Investment Bank. An extra 1.6 million shares, owned by various shareholders, can be made available to the underwriters for the next 30 days, should over-allotment occur. Mitel will not profit from the sale of these shares.

Mitel planned to go public as far back as four years ago, but the plans were abandoned in light of the vendor's acquisition of rival Inter-Tel. The $723m deal was agreed in April 2007, and the Canadian firm swiftly put the kybosh on its IPO application process.