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Unnamed PE firm tables bid to rival $1.96bn deal agreed with Mitel in April.
Polycom has received a new takeover offer from an unnamed private equity company that could derail the US$1.96 billion deal it brokered with Mitel last month.
The conferencing specialist said its new suitor’s offer could be superior to Mitel’s.
In an SEC filing it said the company, referred to as Sponsor 1, has offered a cash dividend of $11 per share to Polycom shareholders and would purchase $650 million worth of a new convertible preferred Polycom stock. The deal would give the PE outfit a 56% holding in Polycom’s outstanding equity.
An alternative scenario would see it acquire Polycom via what it terms a ‘take private’ transaction for $11.50 per share in cash and a contingent value right worth up to $3.00 per share.
"The Polycom board, in consultation with its legal and financial advisors, will consider the outcome of its discussions or negotiations with Sponsor 1 to determine the course of action that is in the best interest of Polycom and its stockholders," Polycom said in the filing.
It added that there can be no certainty that talks with Sponsor 1 will result in a binding proposal, nor that its proposal will be deemed superior to that agreed with Mitel.
Mitel itself insists its offer is in Polycom’s best interests.
"The transaction that was announced on 15 April…offers superior and greater upside to both Polycom and Mitel," it said in response to Polycom’s announcement.
Specifically, it noted that under its transaction, Polycom shareholders will own 60% "of a $2.4 billion, highly profitable, low leverage, strong cash flow company with the scale and portfolio breadth to compete," adding that the deal offers the certainty of committed financing in a volatile debt market as well as strong synergy opportunities.
"Mitel’s acquisition of Polycom continues to be the best path forward and best strategic choice to create shareholder value, driven by attractive financial and operational scale," Mitel said.
Mitel also noted that it is continuing to work with Polycom with a view to closing the deal in the third quarter of this year.
Polycom, meanwhile, said its board has not changed its recommendation in support of the Mitel merger.
