One year ago Ottawa-based Mitel completed a nearly $1-billion takeover of an Arizona company called Inter-Tel. It was rated as the biggest business deal of the year in Ottawa.

Now the newly-merged firm holds top spot in its market space and company executives say they're on track to grow.

Mitel aims their telephone systems business at small- to medium-sized companies. Their labs constantly work on new ways to link office phones, the Internet, wireless phones and data. The buzz phrase is unified communications.

The sector is growing at about 25 per cent a year, and by next year will be worth $27 billion. It's a fiercely competitive environment filled with demanding customers, said Mitel CEO Don Smith.

"Customers only have time to deal with pain," he said, "They are looking for solutions and a quick return on investment. (And) no longer looking for payback benefits in 24 to 30 months. Now it's down to 12 months. "

Mitel needed to grow to improve its flagging bottom line. Inter-Tel, based in Phoenix, added some new products to their lineup. The company's founder tried to stop the deal but shareholders voted in favour.

About six per cent of Mitel's merged workforce was dismissed as the firms took about six months to integrate, overseen by Smith.

The Analyst's Take

Jon Arnold of Toronto is one of the few analysts to watch Mitel on a regular basis.

He said merging two companies of almost equal size is difficult, but Mitel is now positioned with the right products and marketing for a period of significant growth.

It's exactly what Don Smith predicts for Mitel and their suppliers.

Mitel's new revenues are believed to be close to $1 billion. As a private firm those figures aren't made public, nor are detailed growth targets. But taxpayers actually own a share of the company, thanks to government loans.

Mitel's largest shareholder and original founder is Terry Matthews, who touts the company's new status.

"We're number one in North America, number one in the U.K., and number one in Western Europe. This is fabulous news. So yes there is a little celebration here.

"We are on track, revenues are up, bottom line is up we are in fighting trim and I am quite happy about it."