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Avaya executives may wait until later this year or 2013 before kicking off its initial public offering to keep from being lost in the expected tidal wave of more anticipated IPOs this year from the likes of Facebook and Palo Alto Networks, according to reports.
The networking and communications technology vendor filed for a $1 billion IPO last year, aiming to launch it sometime in the first half of 2012. But the combination of such factors as the struggling economic picture and Facebook preparing for its own $5 billion IPOwhich would be the largest in tech industrys historyhad Avaya executives worried that investors would be less likely to take a look at their stock, according to reports by Reuters and BloombergBusinessweek, both of which quoted unnamed sources close to the situation.
One source told Reuters that Avaya’s IPO is in a “wait-and-see mode,” though others added that Avaya and its ownersprivate equity firms Silver Lake and TPG Capitalare committed to the IPO. However, no dates have been decided.
Avaya began life as part of AT&T, then was part of Lucent Technologies before becoming its own company in 2000 when Lucent spun it off. It was listed on the New York Stock Exchange for seven years before Silver Lake and TPG bought it for $8.3 billion in 2007 and took it private.
Avaya officials have worked hard over the past several years to build up its networking and communications capabilities. In 2009, Avaya bought Nortels Enterprise Solutions business for $915 million, part of Nortels fire sale after it went into bankruptcy. The deal brought business-level networking technology to Avaya.
A year later, Avaya officials introduced its Virtual Enterprise Network Architecture (VENA), which is designed to simplify data center operations and extend private clouds from the data center to remote offices.
Avaya also is looking to expand its communications and collaboration portfolio. In 2009, the company launched its Aura unified communications (UC) platform, and has been adding to it since. At the Enterprise Connect show the week of March 26, Avaya launched its Collaborative Cloud framework for UC and video collaboration, as well as a suite of cloud-based solutions, called AvayaLive. That includes AvayaLive Connect, an integrated UC offering for smaller businesses that includes everything from voice and voice conferencing to messaging, video and mobility.
The company also is looking to bolster is video conferencing capabilities by buying Radvision for $230 million in a deal expected to close within three months. Avaya currently partners with various video collaboration vendors, but officials are looking to offer greater integration with its own in-house technology through the Radvision deal.
However, despite Avayas efforts, investors reportedly view Avaya as an established company in a mature market, and are more interested in more up-and-coming spaces like social media, cloud computing and mobility.
Some of the more attractive IPOs being considered include not only Facebook and Palo Alto Networks, but also Workday, which makes HR software, and ServiceNow, which makes technology management software.