On April 24th Mitel Networks announced it had signed a definitive arrangement agreement to be acquired by an investor group led by affiliates of Searchlight Capital Partners, L.P. The agreement is an all-cash transaction valued at approximately $2.0 billion including Mitel’s net debt.
Mitel has gone from publicly traded to privately held several times in their 45-year history. They have also been on a buying spree for over a decade, acquiring InterTel, Aastra Technologies, Toshiba and most recently ShoreTel in 2017.
Industry speculators have vacillated between disparaging the recent move as a vehicle for profit-taking by Mitel senior management to lauding them for strategically positioning the company for the future. Other industry pundits believe that Mitel has made this move to become more agile and accelerate the delivery of public or private cloud solutions to meet expanding interest in US and international cloud services.
“Going private lets Mitel go all-in on the cloud and be aggressive in ensuring its channel is ready to flip the base when the cloud light goes on in Europe.” – Zeus Kerravala of ZK Research
Other industry experts are drawing parallels between Mitel and Searchlight and the Avaya / Silver Lake Partners acquisition a decade ago. The $8.2B dollar acquisition by Silver Lake in 2007 left Avaya debt-ridden and filing for bankruptcy 10 years later.
In 2007 Silver Lake was positioned as a leading firm focused on large scale investments in technology and related growth industries. Today Searchlight is touted as a leading private investment firm with ventures in North America and Europe. Their current portfolio includes other telecommunications and cloud technology companies.
