An Irish businessman, Mr Gerard Moore, stands to make €37 million from the sale of the company he runs, Spectel, to a US operator, writes Barry O'Halloran
US telecommunications company Avaya announced yesterday that it planned to buy Co Dublin-based Spectel for €85.7 million ($103 million).
The deal values Mr Moore's 43.4 per cent stake in the company at €37 million. Under its terms, he will receive in the region of €14.5 million once the deal goes through in two months.
He will be obliged to remain as chief executive for a year, and will retain 26 per cent of the company for this period. After this time elapses, he will be free to leave and sell the remainder of his stake for the price agreed yesterday.
Spectel was founded when Mr Moore led a management buyout of the Irish subsidiary of a multi-national in 1996. They re-engineered the business as a developer and manufacturer of video conferencing equipment, which uses the Internet to link up individuals in different locations.
Spectel is ranked as one of the global leaders in this field. It employs 210 people in Stillorgan, Co Dublin, the US and the Far East.
In 2002, the last year for which figures are available, it had sales of $38.5 million (€32 million) and net assets of $38.6 million.
Four years ago, it raised €12.7 million from private investors through NCB Stockbrokers. That valued the company at around €85 million. It is understood that NCB acted as Spectel's advisers on the sale.
During that fundraising round, Mr Moore said the company intended to float within "12 to 24 months". That plan was abandoned, however, after the technology bubble burst and stock values plummeted on both sides of the Atlantic during 2000 and 2001.
Avaya employs 80 people at its Irish base in Bray, Co Wicklow. It develops technology that allows phone calls and data to be transmitted via the cheaper avenue of the Internet.
It had €830 million in sales and profits of €48 million in the three months to the end of June.
The two companies have worked closely together, and Avaya already uses Spectel technology in its products.