PLCM Polycom, Inc. (MM)

Polycom Inc. agreed to be acquired by private-equity firm Siris Capital Group LLC and ended its previously announced deal with Canadian telecommunications company Mitel Networks Corp.

The two firms said Siris Capital is paying $12.50 per share for Polycom, valuing the company at about $2 billion, including debt. Polycom shares rose 13.1% to $12.30 in premarket trading. Mitel shares rose 22% to $7.32 in premarket trading.

Under the Mitel deal, which was announced in April, Polycom stockholders were slated to receive $3.12 in cash and 1.31 Mitel shares for each Polycom share. Based on Thursday's close, the deal values Polycom at $11 a share. When the deal was announced, it valued Polycom at $13.44 a share. Since then, shares have fallen for both companies.

Polycom will pay Mitel a termination fee of $60 million.

Mitel said Friday that it was disappointed that its deal with Polycom was terminated but that it wasn't in the "best interest of Mitel shareholders to adjust the existing agreement."

In May, Polycom disclosed it had received an offer from a then-unnamed private-equity firm. On July 7, Polycom received a higher offer, and Mitel declined to renegotiate. Polycom is canceling its special stockholder meeting that was to vote on the merger with Mitel.

The Siris Capital deal is subject to regulatory approval, shareholder approval and other customary closing conditions and is expected to close in the third quarter of the year.

Mitel and Polycom were initially brought together by Paul Singer's Elliott Management Corp., an activist investor whose victories include EMC Corp.'s decision to sell itself to Dell Inc. Elliott Management didn't immediately respond to a request for comment.

Polycom, based in San Jose, Calif., develops video and voice collaboration technologies for business uses.

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

July 08, 2016 08:25 ET (12:25 GMT)

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