<PAGE> 1                                                 http://www.mitel.com

                                UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549
                                 FORM 10-Q


      [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
               OF THE SECURITIES EXCHANGE ACT OF 1934

               For the quarterly period ended December 27, 1996

                                  OR

      [ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
               OF THE SECURITIES EXCHANGE ACT OF 1934
   
                     Commission file number 1-8139


                          MITEL CORPORATION
 
         (Exact name of registrant as specified in its charter)
 

           CANADA                                   NONE

        (State or other jurisdiction of        (I.R.S. Employer
         incorporation or organization)         Identification No.)


         350 Legget Drive
         P.O. Box 13089
         Kanata, Ontario, Canada                   K2K 1X3 

        (Address of principal                     (Postal Code)
         executive offices)
       

Registrant's telephone number, including area code:  (613) 592-2122

Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (or for such shorter period that the 
registrant was required to file such reports), and (2) has been subject to 
such filing requirements for the past 90 days.

Yes  (X)     No  ( )

The number of common shares outstanding as at January 30, 1997 was 
107,353,681.

                                  Page 1 of 23

<PAGE> 2
                               MITEL CORPORATION

                                    INDEX






PART I.  FINANCIAL INFORMATION (Unaudited)


ITEM 1.  FINANCIAL STATEMENTS

         Consolidated Balance Sheets -
         December 27, 1996 and March 29, 1996 . . . . . . . . . . . .  3


         Consolidated Statements of Retained Earnings -
         Three months and nine months ended
         December 27, 1996 and December 29, 1995 . . . . . . . . . . . 4
	

         Consolidated Statements of Income -
         Three months and nine months ended
         December 27, 1996 and December 29, 1995 . . . . . . . . . . . 5
	

         Consolidated Statements of Cash Flows - 
         Nine months ended December 27, 1996 and December 29, 1995 . . 6


         Notes to the Consolidated Financial Statements  . . . . . . . 7



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS . . . . . . . . . . . . .12




PART II. OTHER INFORMATION


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K . . . . . . . . . . . . . . 20

                                       2
<PAGE> 3
                                  Mitel Corporation
                        (incorporated under the laws of Canada)
                             CONSOLIDATED BALANCE SHEETS
                          (in millions of Canadian dollars)
                                    (Unaudited)
<TABLE>
<CAPTION>
                                                        Dec. 27,     March 29,
                                                          1996         1996
                                                        -------      -------
<S>                                                     <C>          <C>
ASSETS
Current assets:
   Cash and short-term investments at cost, 
     which approximates market                          $ 122.3      $ 137.3
   Accounts receivable                                    148.6        145.7
   Inventories (Note 3)                                    86.9         72.5
   Prepaid expenses                                         5.2          6.7
                                                        -------      -------
                                                          363.0        362.2
Capital assets: 
   Fixed assets (Note 4)                                  176.8        143.7
   Other assets                                            11.9         11.2
                                                        -------      -------
                                                        $ 551.7      $ 517.1
                                                        =======      =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Accounts payable and accrued liabilities             $  87.9      $ 103.6
   Income and other taxes payable                          11.7         14.9
   Deferred revenue                                        21.2         22.2
   Current portion of long-term debt                       12.9         11.2
                                                        -------      -------
                                                          133.7        151.9
Long-term debt                                             47.5         39.6
Pension liability                                          12.3         12.1
Deferred income taxes                                      11.1         10.7
                                                        -------      -------
                                                          204.6        214.3
                                                        -------      -------
Shareholders' equity:
   Capital stock (Note 5)
     Preferred shares                                      37.2         37.2  
     Common shares                                        153.0        150.6
   Contributed surplus                                     32.3         32.3
   Retained earnings                                      115.7         79.4 
   Translation account (Note 6)                             8.9          3.3 
                                                        -------      -------
                                                          347.1        302.8
                                                        -------      -------
                                                        $ 551.7      $ 517.1
                                                        =======      =======
</TABLE>

                                       3
<PAGE> 4
                                  Mitel Corporation
                    CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
                         (in millions of Canadian dollars)
                                    (Unaudited)
<TABLE>
<CAPTION>
                                 Three Months Ended        Nine Months Ended 
                                Dec. 27,    Dec. 29,     Dec. 27,     Dec. 29,
                                  1996        1995         1996         1995	
                                -------     -------      -------      -------
<S>                             <C>         <C>          <C>          <C>

Retained earnings, 
 beginning of period            $ 105.0     $  54.6      $  79.4      $  31.7

Net income for the period          11.5        11.2         38.7         35.8
                                -------     -------      -------      -------

                                  116.5        65.8        118.1         67.5 

Dividends on 
 preferred shares (Note 7)         (0.8)       (0.8)        (2.4)        (2.5)
                                -------     -------      -------      -------

Retained earnings, 
 end of period                  $ 115.7     $  65.0      $ 115.7      $  65.0
                                =======     =======      =======      =======
</TABLE>

                                        4                                       
<PAGE> 5
                                  Mitel Corporation
                          CONSOLIDATED STATEMENTS OF INCOME
             (in millions of Canadian dollars, except per share amounts)
                                    (Unaudited)
<TABLE>
<CAPTION>
                                  Three Months Ended        Nine Months Ended 
                                Dec. 27,    Dec. 29,     Dec. 27,     Dec. 29,
                                  1996        1995         1996         1995	
                                -------     -------      -------      -------
<S>                             <C>         <C>          <C>          <C>
Revenue:                                               
   Products                     $ 156.2     $ 110.6      $ 449.6      $ 357.1
   Service                         16.8        15.1         50.8         54.3
                                -------     -------      -------      -------
                                  173.0       125.7        500.4        411.4 
                                -------     -------      -------      -------
Cost of sales (excluding amortization):               
   Products                        73.0        50.2        211.1        175.3
   Service                         11.4        10.9         32.9         34.3
                                -------     -------      -------      -------
                                   84.4        61.1        244.0        209.6
                                -------     -------      -------      -------
Gross margin                       88.6        64.6        256.4        201.8
                                -------     -------      -------      -------
Expenses:	
   Selling and administrative      53.3        39.9        150.5        124.0
   Research and development
    (net)                          14.0        10.5         44.2         31.1
   Investment tax credits related to prior years'
     research and development      (2.8)         -          (7.6)          -
   Amortization                     8.5         4.8         24.2         14.0
                                -------     -------      -------      -------
                                   73.0        55.2        211.3        169.1 
                                -------     -------      -------      ------- 
Operating income                   15.6         9.4         45.1         32.7

Gain on sale of
 investment (Note 8)                  -           -          3.6            -

Interest:
   Income                           1.4         2.5          4.8          7.6 
   Expense                         (0.6)       (0.4)        (1.7)        (1.2)
                                -------     -------      -------      -------
Income before income taxes         16.4        11.5         51.8         39.1
Income tax expense                  4.9         0.3         13.1          3.3
                                -------     -------      -------      -------
Net income for the period       $  11.5     $  11.2      $  38.7      $  35.8 
                                =======     =======      =======      =======
Net income for the period attributable to common shareholders after
 preferred share dividends      $  10.7     $  10.4      $  36.3      $  33.3
                                =======     =======      =======      =======
Net income per common share:
 Basic (Note 5)                 $  0.10     $  0.10      $  0.34      $  0.31
                                =======     =======      =======      =======
 Fully diluted (Note 5)         $  0.10     $  0.10      $  0.33      $  0.31 
                                =======     =======      =======      =======
</TABLE>                               
                                       5
<PAGE> 6
                                  Mitel Corporation
                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (in millions of Canadian dollars)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                           Nine Months Ended
                                                         Dec. 27,     Dec. 29,
                                                           1996         1995
                                                         -------      -------
<S>                                                      <C>          <C>
CASH PROVIDED BY (USED IN)
Operating activities:
   Net income for the period                             $  38.7      $  35.8 
   Amortization                                             24.2         14.0
   Gain on sale of capital assets and investment            (4.3)           -
   Increase in pension liability                             0.5            - 
   Deferred income taxes                                     0.3         (0.4)
   Increase in working capital (Note 10)                   (33.9)       (19.4)
                                                         -------      -------
Total                                                       25.5         30.0
                                                         -------      -------
Investing activities:
   Additions to capital assets and investment              (56.2)       (24.2)
   Proceeds from disposal of capital assets and investment   4.9          0.1 
   Net change in non-cash balances related 
    to investing activities                                 (2.4)         3.3
                                                         -------      -------
Total                                                      (53.7)       (20.8)
                                                         -------      -------
Financing activities:
   Increase in long-term debt                               18.4         12.4
   Repayment of long-term debt                              (9.3)        (6.2)
   Repurchase and redemption of preferred shares (Note 5)      -         (1.5)
   Dividends on preferred shares                            (2.4)        (2.5)
   Issue of common shares (Note 5)                           2.4          0.7
   Net change in non-cash balances related 
    to financing activities                                  0.8            -
                                                         -------      -------
Total                                                        9.9          2.9
                                                         -------      -------
Effect of currency translation on cash                       3.3         (1.5) 
                                                         -------      -------
Increase (decrease) in cash and short-term 
 investments                                               (15.0)        10.6

Cash and short-term investments, 
 beginning of period                                       137.3        141.6
                                                         -------      -------
Cash and short-term investments, 
 end of period                                           $ 122.3      $ 152.2
                                                         =======      =======
</TABLE>
                                       6
<PAGE> 7
                                 Mitel Corporation
                    NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
       (in millions of Canadian dollars, except share and per share amounts)
                                   (Unaudited)

1.   In the opinion of  Management,  the unaudited consolidated financial 
statements reflect all adjustments, which consist only of normal and 
recurring adjustments, necessary to present fairly the financial 
position at December 27, 1996 and the results of operations and the 
changes in financial position for the three and nine month periods ended 
December 27, 1996 and December 29, 1995, in accordance with accounting 
principles generally accepted in Canada.(See also Note 10).

These financial statements should be read in conjunction with the 
financial statements and notes thereto contained in the Company's Annual 
Report on Form 10-K for the year ended March 29, 1996.  The Company's 
fiscal year-end is the last Friday in March.

2.    Due to the cyclical nature of the business, the results of operations 
for the periods presented are not necessarily indicative of the results 
to be expected for the full year.  

3.    The components of inventory are:
<TABLE>
<CAPTION>
                                                  Dec. 27,      March 29,	
                                                    1996          1996
                                                  -------       -------
      <S>                                         <C>           <C>
      Raw materials                               $  31.1       $  21.9
      Work-in-process                                24.5          22.6 
      Finished goods                                 31.3          28.0
                                                  -------       -------
                                                  $  86.9       $  72.5
                                                  =======       =======
</TABLE>													
<TABLE>
<CAPTION>
4.    Fixed assets:                               Dec. 27,      March 29,
                                                    1996          1996
                                                  -------       -------
      <S>                                         <C>           <C>
      Cost                                        $ 409.9       $ 350.3
      Accumulated amortization                     (233.1)       (206.6)
                                                  -------       -------
                                                  $ 176.8       $ 143.7
                                                  =======       =======
</TABLE>
<TABLE>
<CAPTION>
5.                                                Dec. 27,      March 29,
                                                    1996          1996
                                                  -------       -------
      <S>                                         <C>           <C>
      Shares outstanding:   
        Preferred Shares - R&D Series               1,617,000     1,618,900
        Common Shares                             107,316,556   106,084,494
</TABLE>
                                       7
<PAGE> 8
<TABLE>
<CAPTION>
                                                     Number of Common Shares
                                                       Nine Months Ended
                                                     Dec. 27,    Dec. 29,
                                                       1996        1995
                                                     ---------   --------
      <S>                                            <C>         <C> 
      Stock Option Plans:
      Outstanding options 
      Balance, beginning of period                   2,902,525   2,721,551
      Options granted                                  708,650     585,000
      Options exercised                               (232,062)   (229,801)
      Options cancelled                                (40,150)    (54,025)
                                                     ---------   ---------
      Balance, end of period                         3,338,963   3,022,725
                                                     =========   =========
</TABLE>
During the nine months ended December 27, 1996 , there were 1,000,000 
common shares issued on warrants exercised, representing all of the 
warrants then outstanding.  Available for grant at December 27, 1996 
were 1,111,275 (March 29, 1996 - 1,779,775) common shares.  The exercise 
prices on stock options issued range from $1.10 to $9.32 per share with 
exercise periods extending to December, 2006. 

There  were  1,900 preferred shares repurchased during the nine months 
ended December 27, 1996.

6.    The following table summarizes changes in the translation account:
<TABLE>
<CAPTION>
                                        Three Months Ended  Nine Months Ended
                                        Dec. 27,  Dec. 29,  Dec. 27,  Dec. 29,
                                          1996      1995      1996      1995
                                        -------   -------   -------   -------
      <S>                               <C>       <C>       <C>       <C>
      Balance, beginning of period      $  4.9    $   4.7   $   3.3   $  10.6
      Increase (decrease):
        Movements in exchange rates -
           United States dollar              -       (0.4)        -      (1.3)
           United Kingdom pound sterling   5.5       (1.0)      7.2      (5.2)
           Swedish krona                  (0.7)         -      (0.6)        -
           Other currencies               (0.7)         -      (0.2)        -
        Reduction of net investment 
         in subsidiaries                  (0.1)         -      (0.8)        - 
                                        -------   -------   -------   -------
      Balance, end of period            $  8.9    $   4.1   $   8.9   $   4.1	
                                        =======   =======   =======   =======
</TABLE>	

7.    The Company  has  not  declared  or  paid any dividends on its common  
shares. During the third quarter, a $0.50 per share dividend was 
declared and paid on the preferred shares.

                                       8
<PAGE> 9

8.    On September 27, 1996, the Company sold all of its 6 percent interest in 
Esprit Telecom (Jersey) Ltd., a non-strategic holding which was 
previously carried at a nominal value on the cost basis of accounting.  
The gain on the sale was $3.6, approximately $2.4 after taxes.

9.   On March 29, 1996,  the Company acquired ABB Hafo AB (subsequently 
renamed Mitel Semiconductor AB), a designer, manufacturer and marketer 
of custom and application specific integrated circuits and 
optoelectronic components with operations based in Sweden and the United 
States. 

Pro forma financial information as if the business had been acquired at 
the beginning of Fiscal 1996 is presented as follows:
<TABLE>
<CAPTION>
                                        Three Months Ended  Nine Months Ended
                                              Dec. 29,          Dec. 29,
                                                1995              1995
                                              -------           ------- 
                 <S>                    <C>                 <C>
                 Revenue                      $ 137.8           $ 448.9
                 Gross margin                 $  69.0           $ 220.7
                 Net income for the period    $   5.3           $  27.5
                 Net income per common share  $  0.04           $  0.24
</TABLE>

This information has been prepared on a basis consistent with Note 15 to 
the financial statements contained in the Company's Annual Report on 
Form 10-K for the year ended March 29, 1996.
      
10.   The  consolidated  financial statements have been prepared in accordance 
with accounting principles generally accepted in Canada (Canadian GAAP), 
which, in the case of the Company, conform in all material respects with 
those in the United States (U.S. GAAP) and with the requirements of the 
Securities and Exchange Commission (SEC), except as fully described in 
Note 18 to the consolidated financial statements as at March 29, 1996.

The following table reconciles the net income as reported on the 
consolidated statements of income to the net income that would have been 
reported had the financial statements been prepared in accordance with 
U.S. GAAP and the requirements of the SEC:

                                        9                                       
<PAGE> 10

<TABLE>
<CAPTION>
                                       Three Months Ended   Nine Months Ended
                                      Dec. 27,   Dec. 29,   Dec. 27,  Dec. 29,
                                        1996       1995       1996      1995
                                      -------    -------    -------   -------
<S>                                   <C>        <C>        <C>       <C>
Net income for the period
in accordance with Canadian GAAP      $  11.5    $  11.2    $  38.7   $  35.8

Effect of deferral accounting
related to foreign exchange contracts    (4.0)      (2.2)      (4.5)      6.0
                                      -------    -------    -------   -------
U.S. GAAP and SEC requirements:
Net income for the period             $   7.5    $   9.0    $  34.2   $  41.8
                                      =======    =======    =======   =======
Net income for the period attributable to common shareholders after 
   preferred share dividends          $   6.7    $   8.2    $  31.8   $  39.3
                                      =======    =======    =======   =======
Net income per common share           $  0.06    $  0.08    $  0.29   $  0.36
                                      =======    =======    =======   =======
</TABLE>
<TABLE>
<CAPTION>
                                                         Nine Months Ended
                                                        Dec. 27,   Dec. 29,
                                                          1996       1995
                                                        -------    -------
<S>                                                     <C>        <C>
Cash flow information presented in conformity
 in all material respects with U.S. GAAP:
Cash provided by (used in)                       
Operating activities - Canadian and U.S. GAAP           $  25.5    $  30.0
                                                        -------    -------
Investing activities - Canadian GAAP                      (53.7)     (20.8)
Change in short-term investments                           (5.5)     (11.8)
Additions to capital assets under capital lease            18.2       12.1
                                                        -------    -------	
Investing activities - U.S. GAAP                          (41.0)     (20.5)
                                                        -------    -------	
Financing activities - Canadian GAAP                        9.9        2.9 
Increase in capital leases                                (18.2)     (12.1)
                                                        -------    -------
Financing activities - U.S. GAAP                          ( 8.3)      (9.2)
                                                        -------    -------	
Increase (decrease) in cash                               (23.8)       0.3
Effect of currency translation on cash flows                3.3       (1.5)
Cash position, beginning of period                         52.4       63.0
                                                        -------    -------
Cash position, end of period                            $  31.9    $  61.8
                                                        =======    =======
</TABLE>

                                       10
<PAGE> 11

Net change in non-cash balances related 
to operating activities:
<TABLE>
<CAPTION>
                                                         Nine Months Ended
                                                        Dec. 27,    Dec. 29,
                                                          1996        1995
                                                        -------     -------
     <S>                                                <C>         <C>
     Accounts receivable                                $   0.2     $  10.1 
     Inventories                                          (13.6)       (3.4) 
     Accounts payable and accrued liabilities             (19.9)      (22.1)
     Deferred revenue                                      (2.3)       (2.7) 
     Other                                                  1.7        (1.3)
                                                        -------     -------
                                                        $ (33.9)    $ (19.4) 
                                                        =======     ======= 
</TABLE>

Balance sheet items in conformity with U.S. GAAP and SEC requirements:

<TABLE>
<CAPTION>
                                                         Dec. 27,   March 29,
                                                           1996       1996
                                                         -------    -------
    <S>                                                  <C>        <C>
    Cash                                                 $  31.9    $  52.4
    Short-term investments                                  90.4       84.9
    Accounts payable and accrued liabilities                89.2      100.4
    Redeemable preferred shares                             34.4       34.4
    Common shares                                          598.9      596.5	
    Contributed surplus                                      2.5        2.5
    Deficit                                               (298.9)    (330.7)
</TABLE>

                                       11
<PAGE> 12

MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS 
OF OPERATIONS
(in millions of Canadian dollars, except per share amounts)


The Company reported third quarter net income of $11.5, or $0.10 per share, 
compared with $11.2, or $0.10 per share, for the same quarter last year.  
Although the gross margin contribution improved by $24.0 on higher sales 
volumes, earnings only slightly improved over the corresponding third quarter 
of last year due to increased operating expenses, lower interest income and a 
higher effective income tax rate. For the nine month period ended December 27, 
1996, net income was $38.7, or $0.34 per share, an improvement of $2.9, or 
$0.03 per share, over the nine month period ended December 29, 1995.

Quarterly and year-to-date revenue grew by 38 percent and 22 percent 
respectively over the comparable periods last year. The revenue growth was 
mostly attributable to the inclusion of Mitel Semiconductor AB, Mitel's 
Swedish semiconductor plant, which was acquired at the end of Fiscal 1996, and 
to significant growth in the Company's original semiconductor business. 
Business Communications Systems (BCS) revenue improved significantly in the 
third quarter, growing by 20 percent over the third quarter of last year, to 
result in a year-to-date increase of 3 percent over BCS revenue in the first 
nine month period of last year.

As a percentage of total revenue, the total gross margin for both the quarter 
and year-to-date periods ended December 27, 1996 was 51 percent, the same 
percentage as in the third quarter last year, but 2 percentage points higher 
than the first nine month period of Fiscal 1996.  Margins remained strong 
primarily due to a good mix of higher margin products sold, particularly in 
semiconductors, high sales volumes, and cost efficiencies obtained in the 
manufacturing plant.

Net income and cash flows for each period as determined by United States 
accounting principles are detailed in Note 10 to the consolidated financial 
statements.

The following discussion should be read in conjunction with the consolidated 
financial statements and notes thereto included with this quarterly report on 
Form 10-Q, and with the Company's audited consolidated financial statements 
and notes thereto for the year ended March 29, 1996.  Certain statements in 
this management's discussion and analysis (MD&A) constitute forward-looking 
statements.  Such forward-looking statements included elsewhere in this 
quarterly report on Form 10-Q involve known and unknown risks, uncertainties, 
and other factors which may cause the actual results, performance or 
achievements of the Company, or industry results, to be materially different 
from any future results, performance, or achievements expressed or implied by 
such forward-looking statements.  Such factors include, among others, the 
following:  general economic and business conditions, demographic changes, 
import protection and regulation, major technology changes, timing of product 
introductions, industry competition, industry capacity and other industry 
trends, and the ability of the Company to attract and retain key employees.

                                      12                            
<PAGE> 13
RESULTS OF OPERATIONS

Mitel's business is global and comprises the design, manufacture and sale of 
systems, subsystems and microelectronic components to world markets in the 
telephony, computer telephony integration (CTI) and communications industries. 
These products and related services include voice communications systems; 
public switching systems; network enhancement and gateway products; CTI 
systems and applications; client server telecom products; custom silicon 
wafers, integrated and hybrid circuits and optoelectronic components.

The Company sells its products through both direct and indirect channels of 
distribution.   Factors affecting the choice of distribution, among others, 
include:  end-customer type, the level of product complexity and integration 
requirements, the stage of product introduction, geographic presence and 
location of markets, and volume levels.

REVENUE

Revenue, based on the geographic location of Mitel's customers, was 
distributed as follows:
<TABLE>
<CAPTION>
                          Nine Months Ended  % of     Nine Months Ended % of
                           Dec. 27, 1996     Total     Dec. 29, 1995    Total
                           --------------    ------    --------------   ------
    <S>                   <C>                <C>      <C>               <C>
    United States               $ 229.2        46 %         $ 199.0       48 %
    Europe                        162.0        32             115.6       28
    Other Regions                  72.3        14              65.5       16
    Canada                         36.9         8              31.3        8
                                -------      ------         -------     ------
                                $ 500.4       100 %         $ 411.4      100 % 
                                =======      ======         =======     ======
</TABLE>
			
For the quarter ended December 27, 1996, the net movement in exchange rates 
from Fiscal 1996 positively impacted total revenue by 2 percent ($2.9) as a 
result of favourable changes in the U.K. pound sterling exchange rate.  The 
year-to-date favourable impact of net movements in exchange rates from Fiscal 
1996 on Fiscal 1997 first nine months revenue was less than 1 percent ($1.2).

Revenue, by product group, was distributed as follows:
<TABLE>
<CAPTION>
                          Nine Months Ended  % of     Nine Months Ended % of
                           Dec. 27, 1996     Total     Dec. 29, 1995    Total
                          --------------     ------   --------------    ------
    <S>                   <C>                <C>      <C>               <C>
    Business Communications
     Systems                    $ 336.5        67 %         $ 326.7       79 %
    Semiconductors                163.9        33              84.7       21
                                -------      ------         -------     ------
                                $ 500.4       100 %         $ 411.4      100 %
                                =======      ======         =======     ======
</TABLE>

                                      13
<PAGE> 14

Business Communications Systems

Business Communications Systems (BCS) comprise PBX equipment and peripherals, 
CTI products and applications, client server telecom products, RADICALL (TM) 
set handlers, call controller products, and the GX5000(R) central office 
switch.  All of the Company's service revenue relates to business 
communications systems, primarily PBX.  

Compared to last year, BCS product revenue for the nine months ended December 
27, 1996, increased by 5 percent due to increased European demand for the 
Company's call controller products, improved sales of CTI products in all 
markets, and higher SX200 (R) sales to U.S. supply houses and dealers.  These 
increases were offset by lower new installations through the Company's direct 
sales channels in both Europe and the U.S.  

Compared to last year, BCS service revenue for the nine months ended December 
27, 1996, decreased by 6 percent mainly as a consequence of the sale of all of 
the Company's North American non-Mitel PBX and key system customer base and of 
the sale of certain U.K. maintenance contracts to other service providers mid-
way through Fiscal 1996.

As a percentage of the total revenue mix, BCS revenue decreased by 12 
percentage points from the corresponding nine month period in Fiscal 1996. The 
business mix changed as a result of the rapid growth of the Company's 
semiconductor business, including the recent acquisition of Mitel 
Semiconductor AB.

Sales into the U.S. BCS market were higher in the first nine months of Fiscal 
1997 compared to the same period last year due to higher levels of SX200 
installations through the indirect sales channel offset by the sale of Mitel's 
non-core base, mentioned above, and the effects of intensified competitive 
conditions.

Mitel's BCS revenue in Europe in the first nine months of Fiscal 1997 
increased compared to the same period in Fiscal 1996 due to improved sales 
volumes of the company's call controller products offset by lower new PBX 
installations.

Sales into the Canadian BCS market were higher in the first nine months of 
Fiscal 1997 compared to the same period last year due to higher levels of new 
installations.
 
During the first nine months of Fiscal 1997, Mitel's primary focus in Asia 
Pacific continued to be its joint venture located in Tianjin, China.  BCS 
revenue during this period decreased in this region compared to the same 
period last year due to the effects of tight monetary policies and intense 
price competition in China.

Semiconductors

In the first nine months of Fiscal 1997, Semiconductor revenue increased by 94 
percent over last year as a result of the additional revenue from the newly 
acquired company, Mitel Semiconductor AB, and increased demand for the 
Company's integrated circuits and thick film hybrid products in all regions. 
Sales into Europe and into the U.S. grew significantly over the same period 
last year largely due to sales by Mitel Semiconductor AB which operates 
primarily in these markets.
                                      14
<PAGE> 15

The increase in Mitel's semiconductor business reflects the worldwide growth 
in the communications segment of the semiconductor industry.  Mitel is 
experiencing growth in countries where there is a demand for Mitel's line of 
communications components from manufacturers of advanced voice, data and 
multimedia equipment in North America, Asia and Europe.  Increased demand for 
communications products incorporating existing Mitel Semiconductor components 
by the Company's traditional customer base, along with the introduction by 
Mitel Semiconductor of new components, including those intended for CTI 
applications, led to increased sales volumes compared to the same nine month 
period last year.

The Company took major steps in Fiscal 1996 to expand its production capacity 
through both the acquisition of Mitel Semiconductor AB, which has a 
semiconductor plant in Sweden, and a major capital expansion program at its 
fabrication plant in Bromont, Quebec, Canada to meet the growing demand for 
its integrated circuits. The first phase of the Bromont expansion program will 
be completed during the fourth quarter of Fiscal 1997, which will improve 
volume capacity of the existing 100 mm wafer production and introduce new 0.8 
micron technology.  The second phase, intended to increase the plant's 
production capacity by converting to 150 mm wafer production, is scheduled to 
be completed in the beginning of calendar 1998.  The estimated time to 
complete each phase is approximately one fiscal quarter later than originally 
planned. 

Subsequent to the acquisition of Mitel Semiconductor AB, management concluded 
that the thermal print-head (TPH) portion of the business was not strategic to 
the Company's interests. On October 23, 1996, the Company sold the TPH 
operations, including related inventory, fixed assets and certain intellectual 
property rights to a German distributor.  The sale of the business did not 
have a significant impact on the Company's financial position or results of 
operations in the third quarter of Fiscal 1997 and will not have a significant 
impact on the Company's financial position or results of operations in the 
future.

GROSS MARGIN

As a percentage of total revenue, total gross margin was 51 percent for both 
the three and nine month periods ended December 27, 1996, the same percentage 
as in the third quarter of last year, but 2 percentage points higher than the 
first nine months of last year.  

Product gross margin improved 2 percentage points over the nine month period 
ended December 29, 1995 mainly due to an increased proportion of high margin 
products sold, higher semiconductor volumes and reduced manufacturing costs. 
However, product gross margins worsened by 2 percentage points over the 
corresponding three month period ended December 29, 1995 due to a lower margin 
semiconductor product mix in the third quarter of Fiscal 1997.

The Fiscal 1997 third quarter and year-to-date service gross margin were 32 
percent and 35 percent, respectively, as compared to 28 percent and 37 percent 
for the three and nine month periods ended December 29, 1995.  Last year's 
year-to-date service margin benefited from the sale and transfer of certain 
U.K. maintenance contracts to Bailey Telecom Limited.

                                      15
<PAGE> 16

OPERATING EXPENSES

Selling and Administrative

Selling and administrative (S&A) expenses increased in the third quarter of 
Fiscal 1997 to $53.3, or 31 percent of sales, from $39.9, and 32 percent of 
sales, for the comparable period in Fiscal 1996.  Year-to-date, S&A expenses 
were 30 percent of sales, the same percentage as the first nine months of last 
year. 

S&A expenses were higher compared to last year primarily due to the inclusion 
of the results of operations of Mitel Semiconductor AB.  In addition, 
operating expenses increased due to higher costs associated with new marketing 
initiatives and product launches (with respect to CTI applications, work group 
solutions, PC telephony and in support of the NeVaDa (TM) networked voice and 
data product), costs associated with the higher sales volumes and higher 
product support costs.  The marketing-related costs include increased trade 
show activity, new corporate communications material, course development for 
dealers and end-customers, and an increase in new hires.

Research and Development

R&D expenses amounted to $14.0 and $44.2, and respectively 8 and 9 percent of 
revenue, for the corresponding three and nine month periods ended December 27, 
1996.  This compares to $10.5 and $31.1, and both at 8 percent of revenue, in 
the respective third quarter and first nine month period of Fiscal 1996. These 
amounts are exclusive of related R&D capital asset amortization and net of 
Canadian provincial government R&D incentives earned.  R&D increased as a 
percentage of sales compared to last year mainly due to the inclusion of Mitel 
Semiconductor AB which currently has a significant program for new integrated 
circuits and optoelectronic components. The Fiscal 1997 year-to-date figures 
reflect a reclassification of certain Fiscal 1997 first quarter research and 
development expenses to cost of sales.
 
For the respective three and nine months ended December 27, 1996, the Company 
accrued separately $2.8 and $7.6 of Canadian federal investment tax credits 
not previously recognized but relating to prior years' R&D.  At the same time, 
the Company elected to defer certain discretionary tax deductions, creating 
taxable income, to increase income tax expense by the same amount as the 
investment tax credits accrued.  Accordingly, the combination of accruing for 
the investment tax credits and the incremental income tax expense resulted in 
no impact to net earnings or earnings per share.

Mitel's R&D program integrates its support for existing products with 
development work in emerging technologies including, among others, the 
following:  CTI; multimedia components and applications; networked voice and 
data; client server telecom; Centrex service enhancements; new ISDN 
applications; and real-time application specific microelectronics components.

                                      16
<PAGE> 17
Amortization

Amortization increased in the third quarter of Fiscal 1997 by $3.7 compared to 
the same period in Fiscal 1996.  For the nine months ended December 27, 1996, 
amortization increased by $10.2 compared to the first nine months of Fiscal 
1996.  The increase is due primarily to the semiconductor capacity expansion 
program, replacements and upgrades to the Company's other manufacturing 
plants, as well as the inclusion of Mitel Semiconductor AB's results of 
operations.

GAIN ON SALE OF INVESTMENT

On September 27, 1996, the last day of the second quarter, the Company sold a 
non-strategic investment in Esprit, a company which provides value added 
network services through leased lines to European based corporate accounts. 
The Esprit investment was sold for cash proceeds of $3.7, representing a total 
gain of $3.6, or $2.4 after-tax.  The gain has been excluded from operating 
income in Fiscal 1997 .

INTEREST INCOME AND EXPENSE

Interest income, net of interest expense, decreased by $1.3 and $3.3 compared 
to the same three and nine month periods last year.  The decrease in net 
interest income resulted from lower Canadian interest rates and from lower 
average cash balances available for investment.  Cash balances available for 
investment were reduced due to the acquisition of Mitel Semiconductor AB for 
$44.0 on the last day of Fiscal 1996.  This acquisition was financed in its 
entirety from the Company's cash resources.

INCOME TAXES

In the third quarter of Fiscal 1997, the Company deferred recognition of 
certain discretionary tax deductions, increasing income tax expense by $2.8 to 
permit the realization of Canadian federal investment tax credits that 
otherwise would have expired.  Year-to-date, this adjustment amounts to $7.6. 

Income tax expense for the third quarter and first nine months of Fiscal 1997 
was $4.9 and $13.1, respectively, and compares to $0.3 and $3.3 for the 
respective periods in Fiscal 1996. Before accounting for the investment tax 
credits, income tax expense for the third quarter and first nine months of 
Fiscal 1997 was respectively $2.1 and $5.5, an increase of $1.8 and $2.2 
compared to the same periods last year.  The increased tax expense is due to 
higher taxable earnings in the U.K., primarily on account of the gain on the 
sale of Esprit and to higher taxes in Canada for corporate minimum tax on 
higher accounting income in Canada.

                                      17
<PAGE> 18
BACKLOG

As orders are frequently booked and shipped within the same fiscal month, 
order backlog is not necessarily indicative of a sales outlook for the month, 
quarter, or year.  This is most true for the Company's business communication 
systems although manufacturing lead times for semiconductor products are 
generally longer because of the nature of the production process.  At December 
27, 1996, order backlog was $133.1 as compared to $138.8 at March 29, 1996. 
The decrease in backlog was mainly attributable to lower semiconductor 
bookings for the China market where local manufacturing companies are faced 
with the effects of tight monetary policies in that country and to the effects 
of the sale of the thermal print head business in the third quarter.  These 
decreases were offset by an improvement in the Company's North American direct 
sales BCS channel.  Most of the backlog is scheduled for delivery in the next 
twelve months.

LIQUIDITY AND CAPITAL RESOURCES

The Company's cash and short-term investment balances decreased by $15.0 from 
the end of Fiscal 1996 due to fixed asset additions and an increase in working 
capital, offset by increased earnings before interest, tax and depreciation.

Cash flow provided by operations decreased by $4.5 compared to the first nine 
months of last year.  Operating cash flow during the first nine months of 
Fiscal 1997 decreased relative to the corresponding period last year primarily 
due to increased working capital requirements.

Since March 29, 1996, the Company's working capital increased by $19.0 to 
$229.3 primarily due to payments on year-end accounts payable and Fiscal 1996 
incentives and an increase in accounts receivable and inventory levels. 
Accounts receivable levels increased over the end of last year due to record 
sales levels in the third quarter.  Inventory increased by $14.4 since year-
end to bring levels in line with expected operating requirements and in order 
to improve the security supply for semiconductor raw materials.  Last year, 
inventory levels dropped significantly at year-end due to the high fourth 
quarter sales volumes.

Fixed asset additions amounted to $55.6 during the first nine months of Fiscal 
1997, and were primarily for the increase in semiconductor manufacturing 
capacity and technology enhancements as well as upgrades to the Company's 
information technology resources. As discussed in previous MD&A's, the 
semiconductor capital program will be conducted in two phases.  Phase one, 
which commenced in the third quarter of Fiscal 1996 and is scheduled to be 
completed during the fourth quarter of Fiscal 1997, is expected to cost 
approximately $9.0 and phase two (scheduled to be completed during early 
Calendar 1998) is expected to cost approximately $39.0.  To date approximately 
$7.6 and $28.0 has been spent on phase one and phase two respectively.  As at 
December 27, 1996, there were approximately $6.0 in capital expenditure 
purchase orders outstanding related to the Bromont expansion program.

On August 30, 1996, the Company entered into an agreement with the Quebec and 
Canadian governments with respect to the Canada-Quebec Subsidiary Agreement On 
Industrial Development (1991) whereby the Company will receive a total of $4.2 
in the form of a non-interest bearing loan toward the phase two construction 
project.  The first claim of eligible expenditures amounting to $2.1 was 
submitted in the third quarter of Fiscal 1997.  Management expects the funding 
will be received in the fourth quarter of Fiscal 1997.  The loan will be 
repayable in three equal annual installments commencing in June 2001.
                                      18
<PAGE> 19

Total long-term debt increased by $9.6, net of repayments of $9.6, from the 
end of Fiscal 1996 due to capital assets acquired under capital leases. The 
repayments included a final payment in the second quarter of Fiscal 1997 of 
$1.8 on the remaining principal balance owing on the non-interest bearing 
unsecured note payable.

On March 29, 1996, the company recorded a liability of $2.0 in respect of 
costs to integrate the operations of the acquired company, Mitel Semiconductor 
AB, with the Semiconductor Division.  During the first nine months of Fiscal 
1997, integration costs of $0.8 were charged against the provision.  These 
costs consist primarily of information systems integration costs.  The Company 
expects that the program to integrate the acquired company with the 
Semiconductor Division will be completed by the end of Fiscal 1997. 

As at December 27, 1996, the Company's capitalization was comprised of 17 
percent debt, 9 percent preferred equity, and 74 percent common equity.  The 
capitalization profile as at the end of Fiscal 1996 was similar at 17, 10, and 
73 percent respectively for debt, preferred and common equity.

In addition to cash and short-term investment balances of $122.3 as at 
December 27, 1996, the Company has unused lines of credit in North America and 
the U.K. of approximately $32.9.

Management believes the Company is in a position to meet all foreseeable 
business cash requirements and debt service from its cash balances on hand, 
existing financing facilities and cash flow from operations.

_________________________
Radicall, GX5000, SX200 and NeVaDa are trademarks of Mitel Corporation.

                                      19
<PAGE> 20

PART II - OTHER INFORMATION


Item 6. Exhibits and Reports on Form 8-K


a)    Exhibits

      Exhibit 11(a)   Computation of earnings per share under Canadian      
                      accounting principles.

      Exhibit 11(b)   Computation of earnings per share under United        
                      States accounting principles.

      Exhibit 27      Financial Data Schedule.


b)    Reports on Form 8-K

      There were no reports on Form 8-K filed for the three months ended    
      December 27, 1996.


                                SIGNATURE

Pursuant to the requirements of the Securities and Exchange Act of 1934, the 
registrant has duly caused this report to be signed on its behalf by the 
undersigned thereunto duly authorized.

                      MITEL CORPORATION (Registrant)


<TABLE>
<S>                                           <C>
February 4, 1997                              JEAN-JACQUES CARRIER
    Date                                      Jean-Jacques Carrier
                                              Vice President of Finance
                                               and Chief Financial Officer
</TABLE> 							

                                      20
<PAGE> 21
                              EXHIBIT INDEX



 
     Exhibit Number                    Description                     

         11(a)             Computation of earnings per share under
                           Canadian accounting principles. . . . . . . . 22


         11(b)             Computation of earnings per share under 
                           United States accounting principles. . . . .  23

   
         27                Financial Data Schedule.

                                      21
<PAGE> 22
                              MITEL CORPORATION                   Exhibit 11a
                      COMPUTATION OF EARNINGS PER SHARE
                       (CANADIAN ACCOUNTING PRINCIPLES)
           (in millions of Canadian dollars, except per share amounts)
<TABLE>
<CAPTION>
                                     Three Months Ended    Nine Months Ended
                                    Dec. 27,   Dec. 29,   Dec. 27,   Dec. 29,
                                      1996       1995       1996       1995
                                    -------    -------    -------    -------
<S>                                 <C>        <C>        <C>        <C>
BASIC EPS 

    Net income                      $  11.5    $  11.2    $  38.7    $  35.8 	
    Less: dividends on 
     cumulative preferred shares       (0.8)      (0.8)      (2.4)      (2.5)
                                    -------    -------    -------    -------
    Adjusted net income             $  10.7    $  10.4    $  36.3    $  33.3
                                    =======    =======    =======    =======
    Weighted average shares 
     outstanding (millions)           107.3      106.0      107.2      105.9	
                                    =======    =======    =======    =======  
  
    Basic EPS                       $  0.10    $  0.10    $  0.34    $  0.31 	
                                    =======    =======    =======    =======	
FULLY DILUTED EPS

    Adjusted net income as        
     determined under basic EPS     $  10.7    $  10.4    $  36.3    $  33.3 	
    Imputed interest on stock       
     options and warrants               0.1        0.1        0.3        0.4 
                                    -------    -------    -------    -------  
    Adjusted net income             $  10.8    $  10.5    $  36.6    $  33.7 	
                                    =======    =======    =======    =======
    Weighted average shares 
     outstanding as determined 
     under basic EPS (millions)       107.3      106.0      107.2      105.9
    Add weighted average shares 
     on conversion of:
     - stock options                    3.3        3.0        3.3        3.0
     - warrants                           -        1.0          -        1.0
                                    -------    -------    -------    -------
    Adjusted weighted average 
     shares outstanding (millions)    110.6      110.0      110.5      109.9
                                    -------    -------    -------    -------
    Fully diluted EPS               $  0.10    $  0.10    $  0.33    $  0.31 
                                    =======    =======    =======    =======	
</TABLE>

                                     22
<PAGE> 23
                                MITEL CORPORATION                  Exhibit 11b
                         COMPUTATION OF EARNINGS PER SHARE
                      (UNITED STATES ACCOUNTING PRINCIPLES)
           (in millions of Canadian dollars, except per share amounts)
<TABLE>
<CAPTION>
                                     Three Months Ended    Nine Months Ended
                                    Dec. 27,   Dec. 29,   Dec. 27,   Dec. 29,
                                      1996       1995       1996       1995
                                    -------    -------    -------    -------
<S>                                 <C>        <C>        <C>        <C>
PRIMARY EPS
 					
    Net income                      $   7.5    $   9.0    $  34.2    $  41.8
    Less: dividends on 
     cumulative preferred shares       (0.8)      (0.8)      (2.4)      (2.5)
                                    -------    -------     -------   -------

    Adjusted net income             $   6.7    $   8.2    $  31.8    $  39.3
                                    =======    =======    =======    ======= 	
    Weighted average shares and 
     share equivalents (millions)     108.6      108.1      108.5      107.9
                                    =======    =======    =======    =======  
 
    Primary EPS                     $  0.06    $  0.08    $  0.29    $  0.36
                                    =======    =======    =======    =======

FULLY DILUTED EPS (1)
    
    Adjusted net income as 
     determined under primary EPS   $   6.7    $   8.2    $  31.8    $  39.3 
                                    =======    =======    =======    =======	

    Weighted average shares and 
     share equivalents (millions)     108.6      108.1      108.5      107.9
    
    Weighted average shares on  
     conversion of stock options          -        0.1          -        0.3
                                    -------    -------    -------    -------
    Adjusted weighted average  
     shares outstanding (millions)    108.6      108.2      108.5      108.2	
                                    =======    =======    =======    =======  
   			
    Fully diluted EPS               $  0.06    $  0.08    $  0.29    $  0.36	
                                    =======    =======    =======    =======
</TABLE>

(1)   This calculation is submitted in accordance with Release No. 33-5133 
under the Securities Act of 1933, as amended, even though the amounts of per 
share earnings on the fully dilutive basis are not required to be stated under 
the provisions of APB Opinion No. 15. 

                                      23