Mitel Readies Going Public

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We found out last week that Mitel´s long awaited planned IPO is just a few weeks away. While the offering price has not been established this is a milestone in the IP telephony market as the financial markets will sort out valuation for this market segment. Today Avaya has a market cap of $5.4B and was ranked 20th in the fastest-growing companies in one year profits in the April, 2006 edition of Fortune magazine´s top 500 companies. Synergy Research Group estimates that IP telephony line shipments grew by a compound annual growth rate or CAGR of 68.7% from 2002 to 2005 and estimates market revenues were approximately $4B worldwide in 2005, while they expect revenue growth of $10.7B by 2009, a 28.2% CAGR. As IP telephony grows, TDM-based systems are expected to decline at a CAGR of 38.1% from 2005 until 2009, again according to Synergy.

Mitel´s IPO will be closely watched by every major IP telephony supplier and those eyeing their own IPO´s such as ShoreTel. Rumor has it that ShoreTel is approaching revenues of $100M and has been profitable for some time. While Mitel´s revenues are over 3 times that number they have not been profitable. A good IPO for Mitel will raise all boats in the IP telephony sea and fill its coffers with resources to boost marketing, R&D and sales.