Polycom is to be bought by Plantronics for $2 billion in cash and stock. The transaction has been unanimously approved by the boards of both companies and is expected to close in the third quarter of the year, subject to regulatory approval and other customary conditions

Plantronics is known as a maker of business and personal headsets and audio solutions. With the acquisition of Polycom, Plantronics aims to become the partner of choice for the communications and collaboration ecosystem.

The cash-and-stock deal comprises about $948 million in cash and Plantronics shares worth $358 million, as well as $690 million in debt. Plantronics plans to make annual cost savings of $75 million a year, within 12 months of the transaction closing, from synergies across the two companies. Polycom was taken private in 2016 by Siris Capital Group for $1.7 billion, ending a three-month old deal with Canada’s Mitel Networks Corp.

The combination of the two companies:

  • Accelerates Plantronics Strategy. Polycom brings a global leadership position in voice and video collaboration, accelerating Plantronics vision of delivering new communications and collaboration experiences.

  • Broadens The Portfolio. With the addition of Polycom, Plantronics will have the broadest portfolio of complementary products and services across the global communications and collaboration ecosystem, and the ability to create exceptional user experiences.
  • Expands Market Opportunity. The combination positions Plantronics to capture additional opportunities across the $39.9bn unified communications and collaboration industry, driven by innovation in video and the ubiquity of audio, building growth opportunities through data analytics and insight services.
  • Augments Services Business. Polycom significantly expands Plantronics services offering, providing a meaningful presence in management and analytics services.

Joe Burton, president and chief executive officer at Plantronics, said: “With the addition of Polycom’s solutions across video, audio and collaboration we will be able to deliver a comprehensive portfolio of communications and collaboration touch points and services to our customers and channel partners. This will put Plantronics in an ideal position to solve for today’s enterprise collaboration requirements while capitalising on market opportunities associated with the evolving, intelligent enterprise.”

“Polycom has returned to growth by focusing on building strong ecosystem partnerships and delivering innovative, smart solutions for our customers and partners,” said Mary T. McDowell, chief executive officer at Polycom. “Bringing Plantronics and Polycom together will broaden the breadth of solutions available to customers and partners and create a consistent end-user experience across many collaboration applications and devices. As one company, Plantronics and Polycom will make it even easier for all customers to solve big-business problems through human-to-human connections.”

“Siris recognizes the incredible opportunity in the unified communications industry and has been focused on building momentum in the industry for several years,” said Frank Baker, founder and managing partner at Siris Capital. “We are excited about the long-term value that the combination of Plantronics and Polycom will create for customers, partners, stakeholders and employees.”