20 January 2017
Following Avaya’s plans for financial restructuring announced in May, Avaya Inc has today confirmed that it has filed for Chapter 11 protection in the U.S. Bankruptcy Court.
Reassuringly, the company said it is expecting approval of $725 million ‘debtor-in-possession’ financing which, if approved, will strengthen funding of operations in the short term. It is also good news to hear Kevin J Kennedy, President and CEO of Avaya, confirm there are no plans to discontinue or divest any products or services, including Avaya’s Contact Centre.
The following is the official announcement from Avaya containing links to additional information:
After assessing a wide range of alternatives to address its capital structure and improve its balance sheet, Avaya has announced that it has filed voluntary petitions to restructure under chapter 11 of the U.S. Bankruptcy Code. This restructuring filing only affects Avaya Inc. and certain other domestic subsidiaries; the company’s foreign affiliates are not affected by this filing. While certain branch offices of Avaya’s U.S. operations may see some limited impact, Avaya is working to facilitate a smooth transition there as well. Avaya has also filed a number of customary “first-day” motions with the Court to facilitate a smooth transition into chapter 11 and minimize business disruption, including a motion seeking authority to continue and honor the company’s obligations under certain customer programs.
Importantly, Avaya is fully focused on the future and does not expect to experience any material disruption as a result of the chapter 11 cases. Avaya is operating business as usual, and remains fully committed to providing the same innovative products and industry-leading services customers have come to expect. Avaya does not plan on discontinuing any products or services at this time.
So why is Avaya taking this action? While its business is healthy and performing well – as reflected in its fourth quarter and fiscal year 2016 financial results – Avaya needs to address its debt and interest expense. Improving Avaya’s balance sheet will help position the company for long-term success and enable it to be an even better partner for you. Avaya is confident that it can emerge as a stronger, more competitive company with the financial flexibility to invest in innovation and growth to expand its market-leading positions, and create solutions and services that will meet your needs today and well into the future.
Avaya is working diligently to move through this process as quickly as possible, and will make every effort to provide regular updates as details become available throughout the chapter 11 cases. In the meantime, Avaya has created several resources that provide additional details on this announcement:
• Watch this video message from Avaya President and CEO Kevin Kennedy about the restructuring and what it means for you
• Visit avaya.com to access the latest news, frequently asked questions, and other resources relating to this announcement