Who Should Acquire Avaya

The problem here, as you know Hewlett Packard Enterprise — Avaya and HPE have a long history of services and joint go-to-market. The two companies have common customers and competitors.Salesforce — It’s been expected for some time that Salesforce may become a contact center provider. It might seem more logical that Salesforce would acquire a CCaaS provider, but why should a cloud innovator pay a cloud premium? The combination could be complementary. Avaya could teach Salesforce about communications and contact center in exchange for lessons on becoming a cloud provider.Microsoft — It’s shocking that Microsoft doesn’t have a contact center play. It has UCaaS, CRM, calendaring, video, team collaboration, and more… but it will never own the enterprise communications stack without a contact center. Avaya OneCloud could be optimized for Azure. The endpoint hardware line could benefit Microsoft Teams users.Oracle — Here’s a company that knows how to acquire. Oracle acquired seven companies last year, and about 90 in the past 10 years. Related acquisitions that fit with Avaya include Acme Packet, Talari Networks, NetSuite (CRM), Micros Systems (hospitality), Responsys (email marketing), among many more.RingCentral — RingCentral has a market cap about six times greater than Avaya’s. It could acquire Avaya and build a migration path for customers that want cloud. The revenue premium for cloud makes a migration path well worth the cost of getting into a premises-based business. RingCentral actually just recently expanded its premises-based solutions, with its Persist product. RingCentral would also be able to bolster its contact center and video capabilities and have a differentiated line of endpoints. Tick, Tock, the Clock Is Running for Avaya Zeus Kerravala September 06, 2019 Lots of speculation surrounds Avaya’s future, but mum’s still the word on a final decision. Oracle makes some sense but that’s about it. HPE could work but they are a compute vendor first. HPE buying this would have the same odds as Dell. Microsoft has many partners on the endpoint side and seems content with that. if you could spin out the CC biz, that could interest MSFT. Salesforce makes zero sense – if they were going to get into the CC game, they would buy a cloud company. However, by doing that, they would alienate all their CC partners. SF best option is to remain friendly with all of them as the world now thinks SF first.Ring would get crucified by Wall St for buying Avaya. Owning an install base is no guarantee you flip them to cloud. Also, much of Avaya’s base is the biggest of big companies and those will likely do private cloud. IF Ring wanted to go down the path of building a private cloud offering a la Azure / Azure Stack, this might make sense but there is so much native UCaaS growth, why would they do this? The most obvious acquirer isn’t another vendor, it’s private equity that doesn’t mind taking on the $3B in debt AND pension liabilities Log in or register to post comments The problem is that Avaya is a much bigger fish than any of the companies Mitel has caught. Mitel has acquired companies of equal and smaller sizes with ease. These include Aastra, Prairie Fyre, Toshiba’s UC systems business, and ShoreTel. It literally swallowed them up and spit out the bones. That’s not going to work with Avaya. I like the potential of these combinations, but I don’t think any are actually very likely. That brings us back to Mitel, which deserves credit for bold thinking. On the other hand, maybe Avaya should remain independent. Its revenue declines and customer losses aren’t problematic if it results in a more nimble, enterprise communications-focused company. It got me wondering if there’s a better fit. If Avaya is truly undervalued, who should acquire it? Here’s my list: Following the receipt of “expressions of interest,” Avaya has engaged J.P. Morgan to assist in exploring alternatives intended to maximize shareholder value. This is likely to do with speculation that Mitel offered to acquire Avaya. Putting price aside, the reaction to the idea of the two companies combining was mixed. Log in or register to post comments Avaya Still on the Block, Resolution May Come Soon Beth Schultz August 14, 2019 As the company plugs away on cloud sales, CEO Jim Chirico looks to wrap up its review of strategic alternatives in the next 30 days. Mitel, Avaya Merger on Tap? Beth Schultz August 20, 2019 On the heels of word that Avaya is close to reaching acquisition deal, the focus turns to Mitel and a reported bid of $20 per share. Avaya Continues Mulling Next-Step Options Beth Schultz September 12, 2019 In a brief update, company said strategic alternative review process continues, gave no indication of new expectations for wrapping it up. Based on Mitel’s previous pattern, it would strip away redundancies, consolidate the portfolios, and eliminate most of Avaya’s managers. None of these would be simple with Avaya. Also, unlike previous acquisitions, Mitel would have to reposition itself as a small business to enterprise vendor, and that’s a tall order that few companies have accomplished. What do you think? question-mark_774.jpg Dave Michels is a contributing editor and analyst at TalkingPointz.Tags:News & ViewsAvayaMitelM&AUnified Communications & CollaborationAnalyst InsightCloud CommunicationsContact Center & Customer ExperienceIndustry NewsVendor Strategy Articles You Might Like See All in Unified Communications & Collaboration » Justifying Workspace Applications: Time to Up the Game Marty Parker September 10, 2019 Communication technology vendors and their value-adding partners must take the lead in defining business justifications for their collaboration and workspace applications. I find the combination both intriguing and concerning. Mitel certainly knows how to acquire businesses. That’s not a trivial credential as most companies are terrible at it. NEC has more or less given up at trying, and Avaya itself doesn’t have a stellar record. Some companies have a disciplined process that seems to work… Mitel, Cisco, Vonage, and West come to mind. Permalink Submitted by LawrenceB941 on Mon, 05/13/2019 – 16:43 Permalink Submitted by zkerravala on Fri, 05/10/2019 – 10:32 Comments Oracle makes some sense but Mitel has a history of chasing after undervalued companies. Avaya shareholders agreeing to sell to Mitel would feel a bit like the dog catching the car. Now what? The problem here, as you know Dave, is that Avaya’s whole portfolio is immensely complicated with multiple overlapping products in all dimensions (many from previous complex acquisitions). Capturing this checkerboard “base” is very difficult and not even Avaya has done a great job in migrating the long tail “base”. Why does anyone else want this headache? Versus just targeting the “base” directly with their own products, as Microsoft and Cisco have been doing aggressively now for a decade, even before the onrush of many new simpler and better integrated cloud alternatives. Log in or register to post comments

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