Creates a global leader in converged IP communications for enterprises,
service providers and mobile operators
- Solidifies comprehensive portfolio of unified communications (UCC)
and rich communications services (RCS) across fixed and mobile
environments
- Significantly expands Mitel’s addressable market and capitalizes on
immediate growth of Voice over LTE (VoLTE) as mobile carriers make the
move to all IP and 4G services
- Adds a new high-growth business unit for Mitel delivering
collaboration services across mobile and enterprise networks
- Expands Mitel's service provider and mobile operator footprint to
over 130 service providers and mobile operators, including 15 of the
top 20 mobile carriers worldwide, covering 2 billion subscribers
BARCELONA, Spain -- (Business Wire)
Mitel® (Nasdaq:MITL) (TSX:MNW), a global leader in business
communications, and Mavenir Systems (NYSE:MVNR), a leading provider of
software-based networking solutions for mobile carriers, today announced
that they have entered into a definitive merger agreement in which Mitel
will acquire all of the outstanding shares of Mavenir common stock in a
cash and stock deal valued at approximately $560 million. Under the
terms of the merger agreement, Mitel will commence an exchange offer
pursuant to which Mavenir stockholders will be entitled to elect to
receive either all-cash or all-stock consideration for each share of
Mavenir common stock, subject to proration, in either case with a value
of $11.08 plus 0.675 of a Mitel common share, or $17.94 based on the
closing price of a Mitel common share on February 27, 2015.
Capitalizing on growth as markets converge around enterprise and
mobile IP unified communications
The transition to LTE has hit an inflection point, with carriers around
the world beginning to transition to all-IP 4G mobile, unlocking the
potential for more efficient delivery of high quality voice services,
new rich communications services, and new revenue sources for mobile
carriers. With the acquisition of Mavenir, Mitel expects to expand its
total addressable market by approximately $14B by 2018*, and be well
positioned to capitalize on increasing demand for 4G LTE services, which
is growing at approximately 52% annually (CAGR). *Source: DellOro,
Infonetics, Markets&Markets.
“Mitel is a leader in enterprise and cloud communications, markets in
which mobility is becoming increasingly influential. With wireless
adoption of IP and 4G LTE and demand for next gen mobile services
ramping quickly, we see a compelling opportunity to capitalize on a
major market transition to add a high-growth mobile business to Mitel,”
said Rich McBee, President and CEO of Mitel. “We believe the combination
of Mitel and Mavenir creates a powerful new value proposition for
enterprises and mobile service providers, using a common IP technology
layer as the foundation for convergence, growth and competitive
differentiation.”
With an established footprint of over 130 mobile customers including 15
of the top 20 mobile carriers worldwide, Mavenir is a leader in 4G LTE
mobile solutions helping to define the market with a series of industry
firsts, including: the world’s first live network deployments of Voice
over LTE (VoLTE) and RCS5 with MetroPCS (now T-Mobile); the first mobile
network deployment of IMS-based VoWi-Fi (Wi-Fi calling) with T-Mobile
US; and the first implementation of Virtualized RCSe with Deutsche
Telekom. The deal provides Mavenir the financial and operational
footprint to drive further market expansion of the company’s
award-winning mobile solutions.
“The move to all-IP LTE mobile networks has created a unique opportunity
for service providers to leverage a converged all-IP network to offer
feature-rich business and consumer communication services to any device,
anywhere, on any access network,” said Pardeep Kohli, President and CEO,
of Mavenir. “We believe that the combined company is ideally positioned
to capitalize on the trends within the communications industry today;
namely, the convergence across enterprise and mobile networks to all-IP
technologies, and the transition to cloud-based unified communications
telephony and software-defined virtualized infrastructure.”
Upon closing of the transaction, Mavenir will become the mobile business
division of Mitel, operating under the brand Mavenir. Pardeep Kohli will
join Mitel in the role of President, Mavenir, reporting to Rich McBee.
Transaction Details
In connection with the execution of the merger agreement, certain of
Mavenir's significant stockholders, who collectively hold approximately
45% of the outstanding shares of Mavenir common stock, have entered into
tender support agreements with Mitel pursuant to which they have agreed
to tender their shares to Mitel’s offer. Mitel intends to finance the
cash portion of the consideration for the acquisition, and the
refinancing of its existing credit facilities and those of Mavenir,
using a combination of cash on hand and proceeds from new senior secured
credit facilities (which will consist of a senior secured term loan and
revolving credit facility), and has received financing commitments from
BofA Merrill Lynch and Credit Suisse AG of approximately $700 million in
the aggregate. Closing of the transaction is subject to Mavenir
stockholders having tendered shares representing at least a majority of
the outstanding shares of Mavenir common stock on a fully diluted basis,
certain regulatory and stock exchange approvals and other customary
conditions. Upon completion of the exchange offer Mitel expects to
complete a short-form merger, which will not require approval of
Mavenir’s stockholders, to cancel any shares of Mavenir common stock not
tendered to its offer in exchange for the merger consideration. The
transaction will not require approval of Mitel’s shareholders and is
expected to be completed in the second quarter of 2015.
BofA Merrill Lynch is acting as financial advisor and Paul, Weiss,
Rifkind, Wharton & Garrison LLP and Osler, Hoskin & Harcourt LLP are
acting as legal counsel to Mitel and White & Case LLP is acting as legal
counsel to BofA Merrill Lynch and Credit Suisse, the lead arrangers of
the financing. Morgan Stanley is acting as financial advisor and Andrews
Kurth LLP and Davis Polk & Wardwell LLP are acting as legal counsel to
Mavenir.
Important Information for Investors
The exchange offer for the outstanding shares of Mavenir common stock
referenced in this press release has not yet commenced. This
announcement is for informational purposes only and is neither an offer
to purchase nor a solicitation of an offer to sell shares of Mavenir
common stock, nor is it a substitute for the registration statement and
exchange offer materials that Mitel and its acquisition subsidiary will
file with the U.S. Securities and Exchange Commission (the “SEC”) upon
commencement of the exchange offer. At the time the offer is commenced,
Mitel and its acquisition subsidiary will file exchange offer materials
on Schedule TO and a registration statement with the SEC, and Mavenir
will file a Solicitation/Recommendation Statement on Schedule 14D-9 with
the SEC with respect to the exchange offer. The exchange offer materials
(including a Prospectus/Offer to Exchange, a related Letter of
Transmittal and certain other offer documents) and the
Solicitation/Recommendation Statement will contain important
information. Holders of shares of Mavenir common stock are urged to read
these documents when they become available because they will contain
important information that holders of Mavenir common stock should
consider before making any decision regarding tendering their shares.
The Prospectus/Offer to Exchange, the related Letter of Transmittal and
certain other offer documents, as well as the
Solicitation/Recommendation Statement, will be made available to all
holders of shares of Mavenir common stock at no expense to them. The
exchange offer materials and the Solicitation/Recommendation Statement
will be made available for free at the SEC’s web site at www.sec.gov.
Copies of these documents will also be made available free of charge on
Mitel’s website at investor.Mitel.com or by contacting Mitel’s Investor
Relations Department at 469-574-8134. Copies of the documents filed with
the SEC by Mavenir will be available free of charge on Mavenir’s website
at www.investor.mavenir.com
or by contacting Mavenir’s Investor Relations Department at
469-916-4393x5080.
In addition to the Prospectus/Offer to Exchange, the related Letter of
Transmittal and certain other offer documents, as well as the
Solicitation/Recommendation Statement, Mitel and Mavenir file annual,
quarterly and special reports and other information with the SEC. You
may read and copy any reports or other information filed by Mitel or
Mavenir at the SEC public reference room at 100 F Street, N.E.,
Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for
further information on the public reference room. Mitel’s and Mavenir’s
filings with the SEC are also available to the public from commercial
document-retrieval services and at the website maintained by the SEC at www.sec.gov.
Forward Looking Statements
Some of the statements in this press release are forward-looking
statements (or forward-looking information) within the meaning of
applicable U.S. and Canadian securities laws. These include statements
using the words believe, target, outlook, may, will, should, could,
estimate, continue, expect, intend, plan, predict, potential, project
and anticipate, and similar statements which do not describe the present
or provide information about the past. There is no guarantee that the
expected events or expected results will actually occur. Such statements
reflect the current views of management of Mitel and are subject to a
number of risks and uncertainties. These statements are based on many
assumptions and factors, including general economic and market
conditions, industry conditions, operational and other factors. Any
changes in these assumptions or other factors could cause actual results
to differ materially from current expectations. All forward-looking
statements attributable to Mitel, or persons acting on its behalf, and
are expressly qualified in their entirety by the cautionary statements
set forth in this paragraph. Undue reliance should not be placed on such
statements. In addition, material risks that could cause actual results
to differ from forward-looking statements include: the inherent
uncertainty associated with financial or other projections; the
integration of Mavenir and the ability to recognize the anticipated
benefits from the acquisition of Mavenir; the ability to obtain required
regulatory approvals for the exchange offer and merger, the timing of
obtaining such approvals and the risk that such approvals may result in
the imposition of conditions that could adversely affect the expected
benefits of the acquisition of Mavenir; the risk that the conditions to
the exchange offer or merger are not satisfied on a timely basis or at
all and the failure of the exchange offer or merger to close for any
other reason; risks relating to the value of the Mitel common shares to
be issued in connection with the exchange offer and merger; the
anticipated size of the markets and continued demand for Mitel and
Mavenir products and the impact of competitive products and pricing that
could result from the announcement of the acquisition of Mavenir; access
to available financing on a timely basis and on reasonable terms,
including the refinancing of Mitel’s debt to fund the cash portion of
the consideration in connection with the exchange offer and merger;
Mitel's ability to achieve or sustain profitability in the future since
its acquisition of Aastra; fluctuations in quarterly and annual revenues
and operating results; fluctuations in foreign exchange rates; current
and ongoing global economic instability, political unrest and related
sanctions, particularly in connection with the Ukraine and the Middle
East; intense competition; reliance on channel partners for a
significant component of sales; dependence upon a small number of
outside contract manufacturers to manufacture products; and, Mitel’s
ability to implement and achieve its business strategies successfully.
Additional risks are described under the heading "Risk Factors" in
Mitel's Annual Report on Form 10-K for the year ended December 31, 2014,
filed with the SEC on February 26, 2015, and in Mavenir’s Annual Report
on Form 10-K for the year ended December 31, 2014 to be filed with the
SEC. Forward-looking statements speak only as of the date they are made.
Except as required by law, Mitel does not have any intention or
obligation to update or to publicly announce the results of any
revisions to any of the forward-looking statements to reflect actual
results, future events or developments, changes in assumptions or
changes in other factors affecting the forward-looking statements.
Conference Call Information
Mitel will host a conference call and webcast accompanied by slides on
March 2, 2015 at 8:30 a.m. ET.
To access via tele-conference, please dial (888) 734-0328. Participants
dialing in from outside of Canada and the United States can dial (678)
894-3054. The playback will be made available two hours after the event
at (404) 537-3406 using access code 98007336. To access the webcast
please use this link: http://investor.mitel.com/events.cfm.
Presentation slides will be available on March 2, 2015 at 8:00 am ET. To
access the presentation slides, please go to the Investor Relations
section of Mitel’s website at www.mitel.com
or use this link: http://investor.mitel.com/events.cfm.
Live internet access and a replay for this call will be available
through the Investor Relations section of Mitel’s website at www.mitel.com.
MITL-F
About Mitel
Powering more than 2 billion connections every day, Mitel (NASDAQ: MITL;
TSX: MNW) helps businesses connect, collaborate and take care of their
customers. That includes more than 33 million cloud connections daily,
making Mitel the world’s fastest growing provider of cloud
communications. Our business communications experts serve more than 60
million users with over 2500 channel partners in more than 100
countries. We have #1 market share in EMEA and have been identified by
top industry analyst firms as a business communications leader. For more
information, go to www.mitel.com
and follow us on Twitter @Mitel.
Mitel is the registered trademark of Mitel Networks Corporation.
All other trademarks are the property of their respective owners.
About Mavenir
Mavenir Systems (NYSE: MVNR) provides software-based mobile networking
solutions that enable service providers to deliver next generation
services over 4G LTE networks. Mavenir™ has a fully virtualized end to
end portfolio of Voice/Video, Messaging and Mobile Core products that
include IP Multimedia Subsystem (IMS), Evolved Packet Core (EPC) and
Session Border Controller (SBC). Mavenir's solutions, based on the
award-winning mOne® software platform, leverage NFV and SDN technologies
for mobile network deployments on cloud-based infrastructure.
© 2014 Mavenir Systems, Inc. All rights reserved. Mavenir Systems®,
mOne®, AirMessenger®, Mavenir™, mStore™, mCloud™, and Transforming
Mobile Networks™ are trademarks of Mavenir Systems, Inc. www.mavenir.com
Contacts:
Mitel
Media Relations:
Amy MacLeod, 613-592-2122, ext.
71245
amy.macleod@mitel.com
or
Industry
Analysts:
Cynthia Navarro, 469-574-8113
cynthia.navarro@mitel.com
or
Investor
Relations:
Michael McCarthy, 469-574-8134
michael.mccarthy@mitel.com
or
Mavenir
Media/Investor
Relations:
Maryvonne Tubb, +1-469-916-4393
mtubb@mavenir.com
Source: Mavenir Systems and Mitel
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