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Michael Cowpland and Terry Matthews founded Mitel in 1972 (officially on June 8, 1972). Conventionally, its name is regarded as a combination of the founders’ first names. Cowpland is quoted as stating that it stands for Mike and Terry's Electronics. The pair formed the corporation in order to protect their intellectual property rights of tone to pulse converter design from their employer, who otherwise would have legal ownership rights. They quickly adjusted to produce a telephony tone receiver product (a tone-
Following the success of the tone receiver, the founders extended their interest in the telecommunications industry. Early on the pair realized the significance of the then new microprocessor and software technology to the design of telecom switches. In 1975, they introduced the SX200 PBX. The company grew at a rate of over 100% per year for several years, and reached the $100 million annual revenue mark by 1981.
In 1976, the company expanded into the semiconductor field with the acquisition of Siltex, a bankrupt ISO-
In 1985, the board of directors created enough new shares to sell a controlling interest (51%) to British Telecom. British Telecom left the equipment business a few years later and sold its controlling interest in Mitel to an investment company called Schroder Ventures.
In the meantime, Mitel continued to diversify its product line, introducing the successful SUPERSET line of phone terminals, the GX 5000 Central Office, and the SMART-