Aastra Technologies

» see aastra.com as it lived, on the wayback machine

~ the obit ~

Aastra never made a product anyone chose. It made the phone that was already on your desk when you started the job, the one with the hard plastic handset and a row of unlabeled line keys, wired into a PBX in a cupboard the IT department visited twice a year. An enormous number of European offices had one. Almost nobody could tell you whose it was.

The company starts in 1983, when Francis Shen and Hugh Scholaert bought an engineering consulting business in Toronto and gave it a new name. For its first decade it worked for the defense industry. It moved into telecommunications in 1993, went public in Canada in 1996, and then spent the next decade executing one strategy with unusual discipline: wait for a large manufacturer to lose interest in its enterprise telephone business, and buy that business.

The list is long. Nortel's Access Solutions assets in 2000, including the right to keep building phones with Nortel's name on them. Lucent's digital video business and Ericsson's cable modem line in 2001. More Nortel divisions in 2002, Ascom's PBX systems in 2003, then the big year, 2005, when it took both the EADS enterprise telephony business and DeTeWe of Germany. In 2008 it bought Ericsson's enterprise PBX division outright, which came with the MD110 and the MX-ONE, the switches that line had always been known for.

~ the rap sheet ~

~ buying the leftovers ~

There is a reason all of this was for sale. Through the 2000s the large network equipment makers were reorganizing around carriers and data, and a division that sold handsets and private exchanges to mid-sized companies was a low-margin distraction with a long support tail. Nortel was in trouble throughout and liquidating anything it could, and Ericsson had decided its future was radio access.

Aastra was built to want it. A business with a declining growth rate and an installed base that cannot easily be moved is a bad investment and an excellent acquisition, provided you pay for it as a declining business and then run it cheaply. Aastra bought the engineering and then kept the product names its customers already knew, which is how it held onto the maintenance contracts. By the time Mitel came for it, the combined company would claim the number one PBX share in Western Europe.

~ seventy five percent ~

In 2005, after the EADS and DeTeWe purchases, 75 percent of Aastra's sales were in Europe. The United States accounted for 17 percent and Canada, where the head office was, for 5 percent. That is an unusual shape for a company listed in Toronto, and it meant the firm's real center of gravity sat in Germany and France while its annual meetings were held in Ontario.

Here is where Aastra drops out of my own memory, even though its hardware sat on desks I later worked at. Enterprise telephony is bought by a facilities manager and installed by a contractor, and the brand on the plastic is a fact about a procurement decision made years before anybody in the building arrives. I have picked up a lot of office phones in Ankara without once looking at the logo. The companies that make them do not need you to.

~ the january merger ~

Mitel announced on 11 November 2013 that it would acquire Aastra in a cash-and-stock deal worth roughly $400 million, and completed it on 31 January 2014. Aastra shareholders got $6.52 in cash and 3.6 Mitel shares for each share they held, which came to about $80 million of cash and 44,162,509 new Mitel shares. Mitel financed it with a $405 million credit facility and used part of the proceeds to clear $259 million it already owed. The press release led on the combined revenue figure, $1.1 billion, and on a customer count of 60 million.

The products carried on under Mitel part numbers and the Aastra name was retired. aastra.com forwards to mitel.com today, which is the usual arrangement: the acquirer keeps the domain pointed at itself so old support bookmarks land somewhere. Aastra had bought eight divisions off larger companies between 2000 and 2008, and the last deal it signed was the one where it was the division being bought.

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