Extreme Networks Buys
Avaya's Networking Business for $100M
March 9, 2017
Networks 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."
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.