RingCentral is acquiring certain Mitel technologies for $650 million, and the two companies will work more closely in the Unified Communications as a Service (UCaaS) market. Look more closely at the announcement, and you'll notice that Mitel also mentioned a CEO transition to Tarun Loomba. Former Mitel CEO Mary McDowell is not mentioned in the release.
Among the RingCentral-Mitel deal terms to note, according to the two companies:
- RingCentral will become Mitel's exclusive UCaaS partner, basically providing Mitel's 35 million users with a path to cloud-based unified communications.
- RingCentral acquired Mitel's CloudLink technology -- which provides a path from on-premises PBX technology to RingCentral’s Message Video Phone (MVP) cloud platform.
- On the flip side, Mitel's investor group led by Searchlight Capital Partners, will invest $200 million in RingCentral.
- Product enhancements leveraging joint technologies (beginning with Mitel phone and device support for RingCentral MVP) is planned for the first half of 2022.
In some ways, the RingCentral-Mitel relationship sounds similar to RingCentral's investment in Avaya from 2019. That alliance shifted Avaya customers to new solutions jointly developed with RingCentral.
RingCentral-Mitel Partnership: Executive Perspectives
In a prepared statement about the RingCentral-Mitel relationship, Mitel CEO Tarun Loomba said:
“We are excited to bring the market-leading UCaaS solution to our customers and channel partners with RingCentral as our exclusive UCaaS partner. The unique depth of this partnership furthers our strategy of delivering world-class communications to our customers and providing them a clear and flexible path for the future.”
Added RingCentral CEO Vlad Shmunis:
“We are bringing together the best of Mitel and RingCentral to give customers the right communications and collaboration solutions for their needs,” said Vlad Shmunis, RingCentral’s founder, chairman and chief executive officer. “Given our maniacal customer-centric focus, we’re delighted to now be able to offer customers a flexible and differentiated digital transformation path.”
In the announcement, Mitel also mentioned that Loomba is the company's "newly appointed" president and CEO. ChannelE2E is checking to see when and why the CEO position transitioned to Loomba from former CEO Mary T. McDowell.
RingCentral Financial Results
The RingCentral-Mitel relationship surfaced the same day that RingCentral announced Q3 2021 financial results. For the quarter, RingCentral disclosed:
- Total revenue of $415 million, up 37% compared to Q3 of 2020.
- A net loss of $147 million, which was larger than the $21 million net loss in Q3 of 2020.
The financial results generally beat Wall Street's expectations.
