Mitel Networks on Friday said it completed its merger with Aastra Technologies.
Mitel Networks, which will have one of the largest global footprints in the industry, has added Aastra Technologies with a view to drive consolidation in the $18 billion business communications market.
The combined company will have about $1.1 billion in annual revenue, over 60 million end users in more than 100 countries, $100 million annual R&D budget, network of more than 2,500 distributors and more than 3,600 people.
With #1 market share in Western Europe and a top five position globally, Mitel is well positioned to capitalize on a massive global growth opportunity as the market begins a long-term migration to cloud-based services.
“With this merger the combined annual revenue of Mitel exceeds a billion dollars, which we believe creates the financial scale and operational leverage to drive shareholder value and profitable growth in an opportunity-rich consolidating market,” said Richard McBee, president and chief executive officer of Mitel.
As part of the merger, Mitel completed financing of a $405 million credit facility consisting of a $355 million term loan maturing in January 2020 and an undrawn $50 million revolving credit facility maturing in January 2019.
The company anticipates approximately $50 million of run rate synergies within two and a half years, driven by supply chain optimization, facilities consolidation and economies of scale.
Mitel, which announced the acquisition in November, paid $392 million for its Toronto rival. Both companies specialize in providing networking and communications gear for small and medium-sized enterprises.
The combined company will be headquartered in Ottawa, Canada and will operate under the name Mitel while continuing to leverage Aastra’s brand recognition in select European markets. The executive management team will continue to be led by current Mitel President and Chief Executive Officer Richard McBee.
Mitel is expecting to maximize installed base upgrade opportunities in large Western European countries including Germany, France and the U.K., and in primary Latin American markets such as Brazil and Mexico and a strong foothold in the Asia Pacific region including Australia.
With minimal channel overlap between the two organizations, the combination expands the addressable market opportunities of existing partners, equipping them to sell into the small and mid-size business market in local or regional geographic opportunities as well as large and lucrative global enterprise accounts.
Meanwhile, on Jan. 20, 2014, Aastra Technologies has acquired Telepo, the Nordic vendor for cloud-based, multi-tenant Enterprise Communication solutions.
Headquartered in Stockholm, Sweden, Telepo’s solution is based on a web-centric architecture which offers mobile integration, including standard voice, PBX and call center features with fully-integrated security and pre-built web based portals for multiple tiers of administrators.