Mitel Drops ShoreTel Bid

ShoreTel board fails to respond, Mitel walks away.

Customers of ShoreTel phones and unified communications gear can stop worrying that their lives might get complicated by a merger between the company and its rival Mitel.

Mitel has taken a $575 million offer for ShoreTel off the table stating the refusal of ShoreTel’s board to talk about the offer.

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“The decision to terminate the proposal early was made in light of the repeated refusal of ShoreTel's Board of Directors to engage in discussions of any kind regarding a potential transaction,” Mitel says in a press release. The offer represented more than 24% more than what ShoreTel’s stock was worth.

If the offer had been accepted, Mitel would have become a formidable force in unified communications, says Jeremy Duke, CEO of Synergy Research Group. If the market for on-premises UC is combined with UC as a service, Cisco is No. 1 with 28.7%, Avaya is 2  with 13.8%, ShoreTel is 3 with 8.7% and Mitel is No. 4 with 7.1%. Post-merger, Mitel/ShoreTel would bump Avaya to No. 3.

The deal would also have improved Mitel’s share of the U.S. market. It would have paralleled the company’s acquisition of Aastra in January that put it at No. 1 in Western Europe, which also made Mitel a billion-dollar company.

Customers would have had to ponder what would happen to the companies’ respective product lines after a purchase and whether gear they had bought would be discontinued.

This story, "Mitel Drops ShoreTel Bid" was originally published by Network World.

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