SAN JOSE, Calif., March 7, 2017 /PRNewswire/ -- Extreme Networks,
Inc. ("Extreme") (NASDAQ: EXTR) today announced it has entered
into an asset purchase agreement with Avaya Inc. to acquire its
networking business. Under the terms of the agreement, the assets
of Avaya's networking business unit will be sold to Extreme for
approximately $100 million, in
accordance with the terms and conditions of the asset purchase
agreement.
"The addition of Avaya's networking business is consistent with
our growth strategy and will broaden Extreme's enterprise solutions
capabilities by complementing our product portfolio across our
vertical markets," stated Ed
Meyercord, President and CEO of Extreme
Networks. "Furthermore, we expect the Avaya business to
generate over $200 million in annual
revenue, increase our market share and offer new opportunities for
our customers. Although our agreement is subject to required
approvals, the timing of which is uncertain, we expect the combined
businesses can achieve synergies and provide accretion to Extreme's
fiscal 2018 earnings and cash flow."
Avaya announced it filed voluntary petitions under chapter 11 of
the U.S. Bankruptcy Code on January 19,
2017. This agreement will constitute a primary bid for the
networking business in a sale process being conducted under Section
363 of the U.S. Bankruptcy Code. As the stalking horse bidder,
Extreme will be entitled to a break-up fee and expense
reimbursement, if it ultimately does not prevail as the successful
bidder at the required auction for Avaya's assets. The auction
process and final agreement will be subject to the approval of the
United States Bankruptcy Court for the Southern District of
New York. In addition, completion
of the transaction remains subject to customary closing conditions
and regulatory approvals. The auction process and transaction
closing are expected to conclude within 3 to 4 months.
Conference Call
Extreme Networks will host a
conference call at 4:30 p.m. Eastern
/ 1:30 p.m. Pacific today to discuss
this announcement. The conference call will be available to the
public through a live audio web broadcast via the Internet at
http://investor.extremenetworks.com. The conference call may
also be heard by dialing 1-877-303-9826 (international callers dial
1-224-357-2194). The encore recording will be available until
March 14, 2017 and can be accessed by
dialing (855) 859-2056 or international 1 (404) 537-3406 with the
conference ID # 83937656.
About Extreme Networks
Extreme Networks,
Inc. (EXTR) delivers software-driven networking solutions that
help IT departments everywhere deliver the ultimate business
outcome: stronger connections with customers, partners and
employees. Wired to wireless, desktop to data center, on premise or
through the cloud, we go to extreme measures for our customers in
more than 80 countries, delivering 100% insourced call-in technical
support to organizations large and small, including some of the
world's leading names in business, hospitality, retail,
transportation and logistics, education, government, healthcare and
manufacturing. Founded in 1996, Extreme is headquartered
in San Jose, California. For
more information, visit Extreme's website or call
1-888-257-3000.
Extreme Networks and the Extreme Networks logo are either
trademarks or registered trademarks of Extreme Networks,
Inc. in the United States and/or other
countries. Other trademarks are the property of their
respective owners.
Forward Looking Statements
Except for the historical
information contained herein, the statements in this release,
including those concerning Extreme's business outlook, future
financial and operating results, and overall future prospects are
"forward-looking statements" within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements speak only as of the date
of this release. Actual results or events could differ materially
from those anticipated in those forward-looking statements as a
result of certain factors, including: our ability to consummate the
acquisition of Avaya's networking business in the bankruptcy
process; failure to achieve targeted revenues and forecasted demand
from end customers; a highly competitive business environment for
network switching equipment; the possibility that we might
experience delays in the development or introduction of new
technology and products; customer response to our new technology
and products; and a dependency on third parties for certain
components and for the manufacturing of our products.
More information about potential factors that could affect
Extreme's business and financial results is included in Extreme's
filings with the U.S. Securities and Exchange Commission,
including, without limitation, under the captions: "Management's
Discussion and Analysis of Financial Condition and Results of
Operations," and "Risk Factors". Except as required under
the U.S. federal securities laws and the rules and
regulations of the U.S. Securities and Exchange
Commission, Extreme Networks disclaims any obligation to
update any forward-looking statements after the date of this
release, whether as a result of new information, future events,
developments, changes in assumptions or otherwise.
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SOURCE Extreme Networks, Inc.