The Guardian
topics

Avaya Confirms It Is In Talks With Skype

Avaya CEO Kevin Kennedy confirmed this morning that the company is in conversations with Skype. The talks are logical given that both companies share a common private-equity owner, Silver Lake. Not very many details were provided, but Kennedy told BusinessWeek this morning: “We are having conversations with [Skype].”

A partnership of some kind could make sense. Today, Avaya provides telecom gear to very large business clients, and may be able to help Skype enter those markets. Up until now, Skype’s web-calling service has been adopted widely by small business owners and consumers, but has yet to prove that it’s reliable enough for large enterprises.

Whether it is would a buy-out, or some other arrangement, it seems up in the air. In late November, Michael Bartlett, who is in charge of Skype’s product strategy told our sister site paidContent:UK  that “eBay (NSDQ: EBAY) has been a great parent to us, but now we’re truly independent so now we can really focus on our core business (with) razor-sharp focus.” He also mentioned that they may be able to tap into Silver Lake’s deep portfolio of companies. “Now, having people like Silver Lake, who have got great companies in their portfolio who have relevance to us as well.”

After all the craziness that Skype has been a part of this year, it could be a happy new beginning for the company. In November, eBay finally closed its deal to sell a controlling stake to an investment group led by Silver Lake for $1.9 billion in cash and a $125 million note. The group acquired 70 percent of Skype in the deal valued at $2.75 billion. Ebay was able to keep a 30 percent stake and is on the hook for $50 million worth of Skype’s debt financing and that note. The spin-off was was first negotiated back in September, but lawsuits by the co-founders held it up.

Dec 18, 2009 2:47 PM ET

Skype Photo: Corbis

Share

Posted In: Media & Publishing, TV, Cable & Telecom, Money, M&A & Venture Capital, Mergers & Acquisitions

  • Rich

    We bought Skype phones and they do not work well at all. Its a hardware issue, they are constantly losing their wifi connections and then missing calls. Skype also charge in Euro’s for the yearly service which is very weird. Finally there is no customer support number, even for paying business customers. We actually didn’t hear back from them at all until we were doing a Paypal charge back.

Unhealthily Obsessed With Mobile Content | mocoNews Newsletter

Know something we don’t?

Send Us a News Tip

All tips are anonymous and untraced.

Sponsors

Contributors