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Kevin Kennedy, president and CEO of Avaya, said: "We believe the acquisition brings inherent value to both organisations' customers, employees and partners, and we look forward to its successful conclusion." Avaya made no other comment on the deal.
When its bid was announced in July, Avaya president and CEO, Kevin Kennedy, said: "The addition of Nortel Enterprise Solutions will increase Avaya's global scale, expand our channel partner network and strengthen our world-class portfolio of products and services. This is a strategic opportunity to acquire talent and complementary assets that position the combined company for growth and success."
The deal covers substantially all of the assets of Nortel's global Enterprise Solutions business as well as the shares of Nortel Government Solutions Incorporated and DiamondWare, Ltd. The sale is expected to close before the end of 2009.
In a press conference following the announcement, Nortel Enterprise Solutions president, Joel Hackney, confirmed that there had been one other bidder but declined to name the organisation. It has been rumoured to have been Siemens.
US news and blog sites have been quick to comment on the announcement. Eric Krapf, co chair of the US VoiceCon events and editor of the No Jitter enterprise telephony blog, wrote: "There may have been a better way [for Avaya] to ensure its place against two massive competitors (Cisco and Microsoft), but I can't think of what it would be. It's a tremendously high-risk move...But I'm not sure that not buying Nortel wouldn't have been a bigger risk."
However he added: "A big winner here is Cisco. Avaya may have shot past Cisco in market share as of the deal's closing, but Cisco is almost certain to begin closing the gap again....Much of Nortel's channel also carries Cisco, facilitating the shift. So now Cisco can sit back and watch its chief rival deal with an almost $US1 billion addition to the $8 billion price tag that Silver Lake and TPG paid for Avaya itself."
On the same blog site, enterprise communications market/product analyst Eric Sulkin, president of TEQConsult Group, wrote that the big questions about the deal were whether Avaya would honour all existing Nortel ES distribution agreements with its large network of dealers; what the future of the Microsoft/Nortel Innovative Communications Alliance would be and whether Avaya would decide to sell-off Nortel ES's collection of data networking products to recoup some of the auction price or continue competing against Cisco and others such as HP despite unfavourable odds.
"Avaya's past attempts to compete in the data arena crashed almost immediately after take-off. Unless there is greater integration between the voice and data offerings, like Cisco's tight integration between its UCM, Catalyst and IOS routers, I personally would not keep the Nortel data products" Sulkin said.
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