Avaya’s $900 million bid for Nortel
At the beginning of the year communications giant Nortel filed for bankruptcy, which was followed by a US Internal Revenue Services claim, relating to $3 billion in back taxes, interest and other penalties (see Utility Exchange – News for related articles) however, according to a comms-dealer.co.uk news feature, Nortel Enterprise Solutions is set to be acquired by business telecommunication company Avaya for US $900 million in proceeds to Nortel with an additional pool of $15 million intended for an employee retention program.
Kevin Kennedy, president and CEO of Avaya said that their successful bid would bring the communication company closer to adding Nortel and its complementary channel, portfolio, research and development, and global presence to Avaya as well as bringing inherent value to both organisations’ customers, employees and partners.
There are a number of key aspects to the deal that will determine Avaya’s success across Europe says John Chapman, industry analyst and Publishing Director of think-tank IT Europa; the first being the critical issue of ‘channel reach’ where at a channel level both companies’ primary pan-European distribution partners are the same in Azlan and Westcon which would simplify the transition and ensure there is continuity for the channel, but as both distributors are also the largest Cisco distributors across Europe, Avaya would need to ensure that it gets sufficient focus to capitalise on the opportunity.
Mr. Chapman also indicated that at a technology level the acquisition would give Avaya an opportunity to become a ‘real alternative’ to networking and communications company Cisco in the broader Unified Communications marketplace. This is where for nearly two decades Nortel has been number two to Cisco in the enterprise networking arena where they recently lost that place to HP ProCurve.
To read in full;
http://www.comms-dealer.co.uk/industry-news/nortel-auction-watch-avaya-selected-acquire-nortel-enterprise-solutions-us-900-million