Mitel Networks plans $300 million term loan for ShoreTel purchase

By Sara Rosenberg

New York, July 27 – Mitel Networks Corp. has received a commitment for a $300 million term loan due in 2023 to help fund its acquisition of ShoreTel, according to a news release.

BMO Capital Markets, Citizens Bank, HSBC Bank and CIBC are the joint lead arrangers and bookrunners on the deal, with BMO the left lead. Citizens Bank is the administrative agent.

The new term loan is expected to come to market sometime after Labor Day, a market source added.

Other funds for the transaction will come from cash on hand and revolving credit facility borrowings.

The company’s existing term loan and revolver will remain in place, and majority consent has already been received for certain amendments which accommodate the acquisition and the incremental financing.

Under the agreement, ShoreTel is being bought for $7.50 per share, or a total equity value of about $530 million and a total enterprise value of around $430 million.

Closing is expected in the third quarter, subject to ShoreTel stockholders having tendered shares representing more than 50% of the outstanding shares of ShoreTel common stock, receipt of regulatory approvals and other customary conditions.

Mitel is an Ottawa-based provider of communications software solutions. ShoreTel is a Sunnyvale, Calif.-based provider of communication solutions.

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