Paul Singer’s Elliott Associates has filed a 13G with the U.S. Securities and Exchange Commission, reporting ownership of 8.66 million shares of Mitel Networks Corporation (NASDAQ:MITL), which marks an increase of 4.77 million shares from the fund’s previous position revealed in the 13F filing for the second quarter. In this way, Elliott currently owns 6.7% of the high-tech company’s outstanding stock.
Elliott Associates is a New York-based hedge fund founded by Paul Singer in 1977, which makes it one of the oldest hedge funds under continuous management. Elliott Associates, in consort with hedge fund Elliot International, forms the well-known Elliott Management Corporation, which oversees more than $23 billion in assets under management. Elliott Associates employs an activist investing approach, usually acquiring stakes in distressed or undervalued companies and pushing for changes so as to unlock shareholder value. As stated by the fund’s most recent 13F filing, Elliott Associates manages a public equity portfolio with a market value of $7.13 billion as of June 30.
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Mitel Networks Corporation (NASDAQ:MITL) is a global provider of business communications and collaboration software and services. The company’s products include applications and mobility options that optimize businesses and assist companies in becoming more productive. Mitel has been recognized by Gartner as a leader in the latest Magic Quadrant (MQ) for Unified Communications (UC), but it seems that this is not completely reflected in the stock price of the company, which has slumped by 24% year-to-date and there are no clear signs that suggest a potential turnaround in the near future. Aside from Elliott, Jim Simons’ Renaissance Technologies owns 1.27 million shares of Mitel Networks, down by 454,112 shares over the second quarter. Meanwhile, Carlson Capital, founded by Clint Carlson, initiated a stake with 724,860 shares during the second quarter.
At the end of April this year, Mitel Networks Corporation announced the completion of its acquisition of Mavenir Systems Inc. for $650 million in cash and stock, which served as a move towards growing the company further on rather than achieving synergies in its existing cloud services business. The transaction led to the creation of a global leader in converged IP communications for enterprises, service providers and mobile operators. Mavenir specialized in supporting mobile service providers with voice, video, messaging, and mobile core services over 4G-LTE cellular networks, so its acquisition gave Mitel the opportunity to capitalize on increasing demand for 4G LTE services. However, it might take a little while until Mitel exploits all the benefits of the acquisition, which might actually serve as a significant boost for the company’s growth.
In the meantime, Mitel Networks Corporation delivered non-GAAP revenues of $292.3 million for the second quarter, compared to $291.7 million reported for the same period a year ago. Simultaneously, the company’s non-GAAP earnings per share came at $0.18, compared to $0.21 posted a year ago. It’s also worth noting that Mitel anticipates revenues in the range of $275 million to $300 million during the third quarter and non-GAAP EPS is expected to be in the range of $0.07 to $0.12.
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