Polycom CEO: Company Is Not for Sale
Polycom, a top rival to Cisco Systems in the increasingly competitive video collaboration space, is not only not for sale, but it's actively looking for other companies to buy, according to its new president and CEO.
Andrew Miller, who was appointed the company's top executive earlier this month, told Reuters in a June 22 report that Polycom officials are looking for companies whose products would complement Polycom's video conferencing portfolio, such as in the areas of niche, cloud computing or mobile.
"We're going to become more active in M&A," he told Reuters.
Rumors about Polycom being sold began to circulate last year, after Cisco made public its bid for Norwegian video conferencing equipment vendor Tandberg. Cisco closed the deal for Tandberg earlier this year for about $3.4 billion.
In November, Logitech made its move in the space with the $405 million acquisition of LifeSize Communications.
Businesses are showing a growing interest in video conferencing, including immersive telepresence technology, as a way of increasing productivity while shaving expensive travel costs.
Cisco bought Tandberg as a way of broadening its TelePresence portfolio and expanding its reach into the midrange business sector. Polycom has been aggressive in partnering with such companies as Hewlett-Packard, which has its own Halo telepresence portfolio.
Polycom's Miller, a former Cisco executive, touted his company's financial strength to Reuters. Polycom ended the last quarter debt-free, and with $470 million in cash and investments on hand.
Polycom also has gotten good vibes from the analyst community. In a research note June 21, Piper Jaffrey analysts said that demand for video conferencing technology was strong, particularly in the United States, and that Polycom should benefit.
"The overall feedback in the U.S. market has been exceptionally strong and is likely at all-time record sales levels this quarter," the analyst report said. "We have received mixed feedback from our European contacts, but the strength in the U.S. market should more than offset European weakness. In addition to video strength, we believe Polycom's voice business is also growing nicely this quarter with strong demand for IP phones and wireless products."
According to Piper Jaffrey, while Polycom's revenue market share dropped slightly in the first quarter, to 31 percent, it grew its market share of unit shipments to 40 percent.