(Reuters) - Mitel Networks Corp (TO:MNW) said on Friday it would buy fellow voice and telephony gear maker Polycom Inc (O:PLCM) for about $1.96 billion in cash and stock, satisfying a demand from hedge fund Elliott Management.
Polycom stockholders will get $3.12 in cash and 1.31 Mitel shares for each of their shares, or $13.68 based on the closing price of a Mitel common share on April 13.
The deal, worth $13.44 per share as of Thursday, represents a premium of 9.5 percent to Polycom's last close.
Upon closing, former shareholders of San Jose, California-based Polycom are expected to hold about 60 percent and current Mitel shareholders are expected to hold about 40 percent of Ottawa-based Mitel.
The combined company will have its headquarters in Canada and will operate under the Mitel name while retaining the Polycom brand.