(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 its customer base.
Mitel will pay $6.52 in cash plus 3.6 Mitel shares per Aastra share, or C$31.96 per share.
The offer represents a 13 percent premium to Aastra’s Friday close of C$28.23 on the Toronto Stock Exchange.
The combined company will have about $1.1 billion in revenue, the two companies said in a statement. Mitel reported a revenue of $576.9 million for the year ended April 30.
The combined company will have over 60 million end users in more than 100 countries and a global network of more than 2,500 distributors.
Mitel said it would increase the number of directors on its board to nine from eight. Two members of the board will step down and Aastra will have the right to nominate three new board members to fill the vacancies, the companies said.
Jefferies LLC is the financial adviser to Mitel, while TD Securities Inc is advising Aastra.
Osler, Hoskin and Harcourt LLP is Mitel’s legal counsel, while Tetrault LLP is Aastra’s counsel.
($1 = 1.05 Canadian dollars)
Reporting by Swetha Gopinath in Bangalore; Editing by Kirti Pandey