Sir Terry Matthews sells Mitel to private investment firm Searchlight for $2 billion

Mitel joins Rackspace in portfolio of Searchlight Capital following $2 billion deal

Communications giant Mitel, co-founded by Welsh entrepreneur and ex-BT trainee Sir Terry Matthews, is to be acquired by private investment firm Searchlight in a deal valuing the company at $2 billion.

On Tuesday, the company, based in Canada, confirmed it had come to definitive arrangement agreement with a group of investors led by Searchlight Capital Partners.

As part of the arrangement, the investors will pay $11.15 per share in cash to Mitel shareholders. Once the deal is finalised, Mitel will operate as a privately held company and attempt to speed up its shift towards the cloud.

Mitel said that its board of directors were "unanimously determined" to complete the deal and that it is in "the best interest" of shareholders to approve the arrangement.

Founded by Welsh technology entrepreneur Sir Terry Matthews in 1972, Mitel provides a range of unified communications products to businesses around the world.

Matthews said: "It also affirms the tremendous value and market leadership of Mitel.

"We believe this transaction will provide Mitel with additional flexibility as a private company to pursue the company's move-to-the-cloud strategy.

"Mitel has succeeded for 45 years because of persistent innovation and relentless focus on delivering shareholder value."

Operating in North America and Europe, Searchlight has acquired a number of companies across the globe, including managed hosting and cloud company Rackspace.

Under the agreement, Capital Markets and TD Securities Inc have agreed to provide debt financing for the transaction. They are also offering financial advisory services to Searchlight.

Once the deal has received shareholder, regulatory and court approvals, it should be closed by the second half of 2018.

However, it is believed that both Mitel and Searchlight are still finalising the closing conditions.

Rich McBee, CEO of Mitel, echoed Terry's enthusiasm by calling the deal an "exciting step" for the company. He said it will form part of the company's continued transformation plans.

"As a private company, and with the strategic and capital support of the Searchlight funds, we will have greater flexibility to manage the transition in our market, accelerate our strategy, and drive the next phase of success for our customers, partners, and employees," added McBee.