Thu, Oct. 8, 12:45 PM
Thu, Oct. 8, 9:46 AM
- Activist Elliott Management has disclosed a 4.4% stake in videroconferencing and unified communications (UC) hardware/software vendor Polycom (PLCM +10%), and a 6.3% stake in UC peer Mitel (MITL +17.1%). Each position was worth ~$100M going into today.
- In an open letter, Elliott declares the unified communications/collaboration space is overdue for consolidation, and calls on Polycom and Mitel to merge. "The combination would double the scale of Polycom to $2.5 billion in revenue. Between Mitels $164 million of EBITDA in 2014 and $100 $150+ million of synergies available, Polycom would quickly become a $500+ million EBITDA company following a combination with Mitel. Scale provides important competitive advantages in addition to the financial benefits of greater diversification, stability and access to capital markets."
- The firm also argues Polycom faces tough videoconferencing competition from Cisco, Avaya, LifeSize (Logitech), and others - "The smaller, newer players continue to take share with cheaper and simpler products while the larger, diversified vendors use their marketing power and bundling to squeeze out companies like Polycom." - and that Mitel's Canadian incorporation could yield tax benefits.
- Elliott: "Polycom's stock can increase by over 30% to $14.75 per share by the end of 2016 and nearly 85% to $20.50 per share by the end of 2017. The best part is that we assume the exact same multiple and absolutely no improvement in revenue trajectory ... the transaction is so compelling that Polycom could pay $10.00 per share for Mitel in an all-stock transaction and still yield a 70% return by the end of 2017 and a 95% return by the end of 2018."
- Also: Elliott notes it has a stake in another UC product provider, ShoreTel (SHOR +0.9%). Mitel made a failed attempt to acquire ShoreTel last year; Elliott argues a deal between the two still makes sense.
Fri, Jun. 26, 5:37 PM
Wed, Jun. 24, 5:36 PM
Tue, Jun. 2, 5:38 PM
Wed, Apr. 29, 1:11 PM
- Mitel's (NASDAQ:MITL) acquisition of carrier VoLTE software provider Mavenir (MVNR) is on the books. As previously announced, Mavenir investors will receive either a mixture of cash/stock worth $17.55/share or 1.83 Mitel shares for each share they own.
- Along with the announcement, Mitel states it has closed on a $710M credit facility that features a $660M term loan sporting an interest rate of LIBOR + 4%. Mitel has used the facility's proceeds to "finance the acquisition of Mavenir, repay the approximately US$280.2 million outstanding under Mitel's existing credit facilities and to repay the approximately US$27.3 million outstanding under Mavenir's existing credit facilities."
- Mitel has sold off following the announcement; its Q1 report arrives on May 7. Mavenir issued a Q1 warning on April 10.
Fri, Apr. 10, 10:23 AM
- Mavenir (NYSE:MVNR) now expects Q1 revenue of $27M-$28.5M, far below prior guidance of $39M-$41M and a $40.2M consensus. EPS guidance has been cut to -$0.41 to -$0.47 from -$0.12 to -$0.17 (consensus is at -$0.14), and gross margin guidance to 50%-53% from 60%-62%.
- Bookings still rose 31% Y/Y, leading the quarter-ending backlog to top $100M. Two 4G customers were added, and full-year sales, GM, and EPS guidance is reiterated.
- The VoLTE infrastructure software provider blames the warning on "a shift in the timing of operator launches in Europe and timing issues associated with the pending acquisition of Mavenir" by Mitel (NASDAQ:MITL). Full Q1 results arrive on May 11.
- Mitel, set to buy Mavenir in a cash/stock deal ($11.08/share in cash + 0.675 Mitel shares for each Mavenir share), is seeing bigger losses than Mavenir. The company has named a new sales chief and a new marketing chief this week.
Wed, Mar. 11, 3:08 PM
- A day after equity markets tumbled (with many high-beta names especially hard-hit), major tech gainers are outnumbering major decliners, though the Nasdaq is nearly flat.
- Today's notable tech gainers include RF backhaul hardware vendors DragonWave (DRWI +15.6%) and Aviat (AVNW +8%), LED lighting provider Revolution Lighting (RVLT +5.4%) online textbook rental/learning services provider Chegg (CHGG +3.8%), auto site TrueCar (TRUE +5.3%), loan-shopping site owner Lendingtree (TREE +6.9%), telecom equipment vendor Calix (CALX +2.7%), TV/set-top SoC provider Sigma Designs (SIGM +4.9%), and VoIP hardware/software provider Mitel (MITL +3.8%).
- Notable decliners include supercomputer maker SGI (SGI -2.9%), 3D printing software vendor Materialise (MTLS -5.5%), security hardware/software provider KEYW Holding (KEYW -2.9%), and Chinese online game developer Changyou (CYOU -2.9%).
- DragonWave and Aviat are reversing yesterday's big losses. Materialise is making fresh 52-week lows a week after posting mixed Q4 results; KEYW is also seeing new 52-week lows. Revolution's gains continue a volatile post-earnings ride: Shares soared last week after the company posted its Q4 results, but gradually gave back their gains.
- Previously covered: SanDisk, Intel, EMC, SunEdison, Resonant, Immersion, Logitech, VeriFone, Mobileye, Dangdang, InvenSense
Mon, Mar. 2, 12:49 PM
Nov. 17, 2014, 10:31 AM
- Mitel (MITL +0.5%) has withdrawn its $540M ($8.10/share) offer to acquire ShoreTel (SHOR -8.6%), first announced on Oct. 20.
- Mitel says its decision stems from "the repeated refusal of ShoreTel's Board of Directors to engage in discussions of any kind regarding a potential transaction." ShoreTel has fallen to $7.50 in response.
Oct. 20, 2014, 10:08 AM
- Following a rejection from ShoreTel's (SHOR +16.1%) board, Mitel (MITL -1.2%) has gone public with an offer to buy the fellow VoIP/unified communications hardware and software provider for $540M, or $8.10/share, in cash. The price represents a 24% premium to ShoreTel's Friday close.
- Mitel says its proposal will remain open until 5PM ET on Nov. 20.
- ShoreTel currently trades at $7.50; its 52-week high is $9.81. With Mitel's market cap only at $936M, there could be some doubts about its ability to pull off a $510M all-cash acquisition. The company had $134.2M in cash at the end of June, and $342M in debt.
May 8, 2014, 12:48 PM
Dec. 13, 2013, 5:39 PM
Dec. 5, 2013, 4:35 PM
Nov. 15, 2013, 5:42 PM
Nov. 14, 2013, 5:44 PM
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