Avaya announces agreement to purchase Nortel Enterprise Solutions

Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4 /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} Avaya has entered into a ÔÇÿstalking horseÔÇÖ asset and share sale agreement to purchase NortelÔÇÖs enterprise business for $475 million, which would create a combined entity with 30 percent of the global contact center market.   Such a deal would cement AvayaÔÇÖs market share lead in North America and fortify its position in other global regions for years to come.   According to industry analyst Ovum, however, the combined company would face a confused product portfolio with a good deal of overlap and a channel that has been beaten, bruised and battered during NortelÔÇÖs long sunset.   While Avaya intends to purchase NortelÔÇÖs Enterprise Solutions business, it is not a done deal as other qualified bidders may submit higher offers in the auction period slated to begin in August.   ThereÔÇÖs also the possibility that NortelÔÇÖs enterprise unit will be broken up by regions and sold to the highest bidders.   If Avaya emerges as the victor in the upcoming bidding war and acquires all of NortelÔÇÖs enterprise unit, it stands to increase its already large market share, inherit NortelÔÇÖs large reseller network and leverage new upsell opportunities among NortelÔÇÖs customer base.   The acquisition of Nortel would not leave Avaya with an easy-to-understand product list, however, as NortelÔÇÖs broad base of products would create the need for another round or two of portfolio rationalization.   Ovum therefore sees the primary drivers behind AvayaÔÇÖs interest in Nortel to be channel expansion and a renewed play for mid-market customers.   Because Avaya will likely eventually replace much of the Nortel technology with its own in the product lineup, it will also have to win over most of the channel partners one by one. This will take some doing since the resellers have stocks of inventory, existing processes and lots of Nortel-specific training.   *┬á┬á┬á┬á┬á┬á┬á┬á┬á *┬á┬á┬á┬á┬á┬á┬á┬á┬á *