Exclusive: Genesys in bid to buy Avaya's call center business - sources

Fri Aug 5, 2016 5:39pm EDT
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By Liana B. Baker and Greg Roumeliotis

(Reuters) - Genesys Telecommunications Laboratories Inc, a U.S. provider of call center software, is in talks to acquire the contact center business that its peer Avaya Inc [AVXX.UL] is hoping to sell for more than $4 billion, according to people familiar with the matter.

The deal would create a call center technology powerhouse in the face of intensifying competition from Cisco Systems Inc (CSCO.O: Quote), Huawei Technologies Co Ltd [HWT.UL] and Mitel Networks Corp (MNW.TO: Quote).

The sale would also see Avaya, one of the world's biggest providers of telephony systems, shed a major part of its business to cope with its debt pile, which has grown to $6 billion.

Genesys is one of many companies and private equity firms that have contacted Avaya about a potential deal, and there is no certainty that it will successfully negotiate a deal, the people said this week.

The sources asked not to be identified because the negotiations are confidential. Genesys and Avaya declined to comment.

A deal for Avaya's contact center business, which powers the customer care and sale operations of some of the world's biggest companies, would come on the heels of a $900 million investment by buyout firm Hellman & Friedman LLC in Genesys last month.

That deal, which saw Hellman & Friedman join Permira Advisers LLP and Technology Crossover Ventures as investors in the company, valued Genesys at $3.8 billion, including debt. Genesys has more than 4,700 customers in 120 countries.

Based in Santa Clara, California, Avaya provides software, hardware and cloud services to businesses for their telecommunications needs. Last year, it had over 300,000 customers, including 83 percent of the Fortune 500 companies.   Continued...

The sign at Avaya Inc. offices and lab in Westminster, Colorado is seen January 23, 2007. REUTERS/Rick Wilking