Mitel Networks to buy Aastra for C$392 million to expand in Europe
By Narottam Medhora
(Reuters) - Mitel Networks Corp MITL.O MNW.TO, a provider of internet phone and video-conferencing services, said it would buy smaller rival Aastra Technologies Ltd AAH.TO for C$392 million ($374 million) to expand in Europe.
Mitel's offer of $6.52 in cash plus 3.6 of its shares per Aastra share values Aastra at C$31.96 per share -- a premium of 13 percent to the stock's Friday close.
Aastra's shares were up 12 percent at C$31.75 in afternoon trade on Monday. They rose as much as 18 percent to C$33.32 earlier in the session.
The deal will double Mitel's revenue, giving the combined company revenue of about $1.1 billion, with 54 percent coming from Europe, Middle East and Africa, according to a presentation posted on Mitel's website.
Mitel is also in talks with a UK-based telephone services provider and is looking to tie up with European carriers to provide cloud-based and telecommunication services, Chief Executive Richard McBee told Reuters.
He declined to provide any further details.
McBee said there is a tremendous opportunity to transition customers in Europe to cloud-based services from a virtual private network platforms.
"(The European) market place is significantly behind the North American market in terms of transition," he said. Continued...