Avaya, which has been a private company for the past four years, is ready to go public again through an IPO, according to a report in the Wall Street Journal.
Avaya, the networking and unified communications vendor that bolstered its
business with its $915 million deal to buy Nortel Networks' enterprise unit,
reportedly is now planning to go public again.
According
to the Wall
Street Journal, Avaya could file papers for a $1 billion IPO as early as
this week. The report, which quoted "people familiar with the matter,"
indicated that the IPO would be for about 20 percent of the company, which had
been a public concern until it was taken private in 2007 by investment firms Silver
Lake and TPG Capital.
The
IPO would put Avaya's overall value at $5 billion, and would make it the latest
tech company in recent months to go the IPO route. Professional networking
site LinkedIn had a wildly successful IPO last month that put the company's
value at about $8.9 billion. Online coupon vendor Groupon recently announced
plans for an IPO that officials hope will bring in at least $750 million.
However,
Freescale Semiconductor, which had hoped to raise $1 billion, generated only
$783 million in its IPO late last month, and recently said it would borrow
another $750 million.
The
underwriters for Avaya's IPO are Citigroup, Goldman Sachs, Morgan Stanley, JP
Morgan Chase, Barclays Capital and Credit Suisse Group, according to the WSJ
story.
Avaya
has declined to comment on the speculation.
Avaya
started out as part of AT&T, then was part of Lucent Technologies, which
had been spun off from AT&T. Avaya became its own company in 2000 when it
was spun off by Lucent, and for seven years was listed on the New York Stock
Exchange until Silver Lake and TPG bought it for about $8.3 billion in 2007 and
took it private.
Over
the past couple of years, Avaya has aggressively expanded its communications
and networking offerings. The deal
for Nortel's Enterprise Solutions business-part of Nortel's fire sale after
it went into bankruptcy in 2009-was a boon, enabling the company to overtake
Cisco Systems as the top enterprise telephony vendor. In 2009, Avaya also
unveiled Aura, its broad UC (unified communications) platform.
On
the networking side, Avaya in November 2010 unveiled VENA
(Virtual Enterprise Network Architecture), which is designed to simplify
data center operations as the facilities become more virtualized and extend to
branch offices and other remote locations. In May, Avaya added to the effort
with a new switch and software.
Avaya
also has looked to grow its reach through a series of partnerships with the
likes of
Hewlett-Packard, IBM, Polycom and Skype.
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