Logitech's talks to buy Plantronics are about conquering that last mile of collaboration and the smart office as much larger competitors enter the market.
In a statement, Logitech confirmed that it was in talks to buy Plantronics, but said discussions ended without a deal. According to Reuters, Logitech was planning to acquire Plantronics for $2.2 billion. The move would combine Logitech's accessories and collaboration platform with Plantronics, which makes hardware that's used for everything from conference calls to huddle rooms. Logitech's market cap is about $5.34 billion and Plantronics is worth $2.02 billion based closing prices Friday.
In response to media reports and in accordance with Swiss disclosure requirements, Logitech today confirmed it was engaged in discussions with Plantronics regarding a potential transaction. However, those discussions were terminated. Logitech does not intend to comment further.
Plantronics traditionally has specialized in headsets and unified communications gear, but acquired Polycom in an effort to move up the food chain. Plantronics closed the purchase of Polycom in July for an enterprise value of $2 billion.
Polycom makes collaboration--video and audio--systems that compete with Logitech's video conferencing unit as well as Cisco and a bevy of other players. Logitech is best known for its consumer business, but has a suite of products aimed at the enterprise. The reality in the smart office market is that no one player has an integrated stack, but most competitors to Logitech and Plantronics have more scale and resources.
Why would Logitech want to roll up the collaboration space with Plantronics and Polycom? Scale. First, there are China tariff concerns and Logitech with Plantronics would have more manufacturing heft to negotiate and weather the U.S. vs. China trade war. But the bigger issue is that Logitech and Plantronics need to compete with a broader set of rivals, which have more scale. Consider the following smart office players.
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- HP has made a big play for the smart office with collaboration hardware. Entering the market via its laptops, HP plans to expand to more gear designed for huddle rooms and collaboration spaces as well as industry specific use cases.
- Lenovo is also eyeing the collaboration market and is working with many of the same partners as Plantronics/Polycom and Logitech.
- Amazon is making a play for the smart office via Alexa for Business. By putting Alexa into the enterprise and integrating with everything from calendar, scheduling and collaboration systems, Amazon can up the manufacturing of devices for businesses. Amazon also has cloud reach via AWS and an army of Alexa developers to leverage.
- Microsoft and Google. Both companies have hardware and collaboration efforts well underway. Microsoft and Google can leverage Office 365 and G Suite, respectively, to expand into collaboration with either hardware made by partners or the companies themselves. TechRepublic: Google Jamboard: How to edit and share Jams from your browser
- A bevy of other players including giants like Cisco and Dell as well as upstarts like Zoom, which is a partner to many competitors to what would be a beefed up Logitech with Plantronics.
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