News broke last week that Mitel is proposing an all-stock buy-out of Avaya. The week prior, rumors were circulating that Avaya was engaging bankers to find a buyer. This is the latest twist in a long, zig-zagging road for the company. It’s only been 16 months since they emerged from bankruptcy.
There’s a tasty irony to an Avaya-Mitel merger. Part of Avaya’s call center business was the result of an acquisition of Nortel assets, following the latter’s bankruptcy in 2009. That collapse is still a psychic wound for the Canadian tech industry. It’s one of those “Where were you when you heard?” kind of moments.
Mitel too holds a special place in the Canadian tech world. Co-founder Sir Terry Matthews is an actual gosh-darned knight. The company is now owned by private equity but is still headquartered in Ottawa.
While the Canada angle is entertaining, the impact of a Mitel-Avaya merger would have very material affects on the contact center world.
Industry watchers are carefully assessing the progress of the Avaya bankruptcy, which is now 50 days old. (Fun tip: The number of days is easy to track because the bankruptcy happened the same day at the US presidential inauguration! So when the press makes a big deal about Trump’s first 100 days, you’ll know Avaya has been in Chapter 11 for 100 days too.)
Avaya’s annual customer conference (“Avaya Engage”) just wrapped up and I believe they made good use of a unique moment in their history. Under normal circumstances, this type of conference is a high pressure situation. Avaya is in complete control of the content and production so if they can’t look perfect here, that’s bad news. If there are missteps or flubbed announcements, or if the crowd isn’t enthusiastic, analysts are quick to take note and turn that into a story.
