Polycom ends Mitel deal, signs 2bn deal with Siris Capital Group

Polycom ends Mitel deal, signs 2bn deal with Siris Capital Group
Polycom is to be bought for $2bn by private-equity firm Siris Capital Group, after it announced it has ended the previously announced $1.9bn deal with Canadian telecommunications company Mitel Networks Corp.

Siris Capital is to pay $12.50 per share for Polycom, valuing the company at about $2 billion.

Both Mitel and Polycom saw their share price jump after the deal was cancelled. Polycom shares rose 13.1% and Mitel shares rose 22%. 

The Siris deal values Polycom at $11 a share, when the Mitel deal was announced, it valued Polycom at $13.44 a share.

Polycom will pay Mitel a termination fee of $60 million.

"We are very excited for the opportunity to partner with Polycom and its leadership team, as the Company fits well with Siris' investment focus on mission-critical telecommunications businesses," said Dan Moloney, executive partner at Siris, in a statement Friday.

Siris added that it wants to use Polycom's audio and video collaboration to move into a cloud-based environment.

"While I am disappointed that this particular transaction will not move forward, I am confident in Mitel's future as an industry leader and as a market consolidator," said Rich McBee, president and CEO of Mitel in a Friday statement.

In May, Polycom disclosed it had received an offer from a then-unnamed private-equity firm. On July 7, Polycom received a higher offer, and Mitel declined to renegotiate.

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