21 Oct Mitel Makes Second Offer For ShoreTel
The United States is a very lucrative market for the telecom industry – given the explosion in wireless devices, and now the advent of virtual payments with Apple Pay. To grab a footing into the US market, Mitel Networks Corporation, based in Ottawa, has just made a $540 million acquisition offer to ShoreTel, Inc., with headquarters in Sunnyvale, CA.
This is Mitel’s second attempt to acquire ShoreTel. The first offer was rejected on October 2nd. This second round now is an all cash offer, valued at $8.10 per share, which is actually 24% above ShoreTel’s stock price at as of the close of business last Friday (10/17).
The ripple effects of this news also positively impacted the stock price of the buyer, which rose by 1% to $9.61 (Canadian Dollars) in today’s trading session (10/20). Shoretel is a leader in the business communication arena, including VOIP, IP Telephony and Cloud based solutions for its customer base.
The CEO of Mitel, Richard McBee, has made even clearer today about his intent to grab a hold of these profit generating services:
“The business communications market is rapidly consolidating and Mitel has clearly stated that we intend to be a consolidator in this market. We see a compelling opportunity to bring together two market innovators with strong and complementary market footprints, particularly in the U.S. where ShoreTel does more than 90% of its business, in a way that delivers significant value and opportunities to the shareholders, customers and employees of both companies.”
This second offer from Mitel has been once again rejected by the ShoreTel Board of Directors, but there is still optimism on the table that ShoreTel could change its mind. According to McBee, this offer is good until November 20th, 2015 5 PM CST. Will they take it? So far, the ShoreTel Board does not seem interested . . . at least, not yet.
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