Plantronics is to acquire Polycom in a cash and stock transaction valued at $2bn. The deal is expected to close by the end of Q3 2018 and gives Plantronics a far broader portfolio of complementary products and services as it targets the $39.9bn UC&C industry where video and audio are most prominent.
Joe Burton, President and Chief Executive Officer, Plantronics, said: "With the addition of Polycom's solutions across video, audio and collaboration we will be able to deliver a comprehensive portfolio of communications and collaboration touch points and services to our customers and channel partners."
?Mary T. McDowell, Chief Executive Officer, Polycom, added: "Polycom has returned to growth by focusing on building strong ecosystem partnerships and delivering smart solutions for our customers and partners.
"Bringing Plantronics and Polycom together will broaden the breadth of solutions available to customers and partners and create a consistent end-user experience across many collaboration applications and devices.
"As one company, Plantronics and Polycom will make it easier for all customers to solve big-business problems through human-to-human connections."
For CY2017, Polycom had GAAP revenue of $1.1bn, Non-GAAP gross margin of 56.6%, Non-GAAP operating income of $183.1 million and Non-GAAP operating margin of 16.0%.
Plantronics intends to fund the cash portion of the consideration with cash on hand and approximately $1.375bn in new, fully- committed debt financing.
Wells Fargo Bank and affiliates have committed to provide the debt financing for the transaction, subject to customary conditions. Plantronics expects to pay down a significant portion of the debt within the next several years with cash on the balance sheet and through cash generation.
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