Avaya Plans $1 Billion IPO

The offering would value Avaya at around $5 billion, or about 40% less than its private equity owners paid four years ago.

Robert Mullins

June 7, 2011

2 Min Read
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Avaya, which makes data and telecommunications network equipment for corporations to enable such technology as unified communications, is expected to file plans for an initial public offering (IPO) of stock aimed at raising $1 billion, the Wall Street Journal reported Tuesday.

For Avaya, it's not an "initial" public offering in the strictest sense of the word because Avaya was spun off as a separate public company in 2000 from Lucent, formerly known as AT&T Technologies. In 2007, Avaya was acquired by two private equity firms, TPG and Silver Lake Partners, for $8.2 billion. According to the Journal, this latest IPO would value Avaya at $5 billion or more, which is about 40% less than the private equity firms paid for it four years ago.

Avaya did not immediately respond to a request for comment.

Avaya has been active in pursuing the enterprise unified communications market with its Avaya Aura platform, which provides UC and contact center technology for midsize to large enterprises.

It even got into the tablet computer race in September 2010 with the introduction of the Avaya Desktop Video Device, which runs on the Avaya Flare platform for combining email, instant messaging, video, voice, text, and other communication tools. It also brings together an employee's contacts from their Microsoft Outlook, Facebook, LinkedIn, Twitter, and Skype accounts.

If the $1 billion IPO goes forward, and the Journal reported the filing could happen as soon as this week, it would be the fourth largest IPO of the year. Other notable tech IPOs this year have been Freescale Semiconductor Holding, the professional social networking Web site LinkedIn, and the IPO filing last week by Groupon, which advertises discounts to various merchants via smartphones and other devices.

The Avaya IPO is being underwritten by Goldman Sachs Group Inc, Morgan Stanley, JP Morgan Chase & Co, Citigroup Inc, Barclays Capital, and Credit Suisse Group, according to the Wall Street Journal.

Employees have more ways to communicate than ever, but until the mishmash of tools gets integrated, productivity will suffer. Also in the new, all-digital issue of InformationWeek: A buyer's guide to enterprise social networking. Download it now. (Free registration required.)

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