Telecommunications company Avaya files for bankruptcy


Telecommunications company Avaya files for bankruptcy

According to this filing, Avaya's foreign affiliates, including Avaya Canada, are not included in the filing and will continue normal operations.

Then Avaya bankruptcy filing will allow the company to restructure the business to focus on software, cloud and managed services, where it has seen growth as overall revenue declined.

Faced with rising debt costs, increasing market competition and declining revenue, the Santa Clara, Calif. -based company had no choice but to protect itself legally from its creditors.

According to the statement provided by Avaya ANZ, the ANZ business unit has closed fiscal 2016 with its strongest quarter in 12 quarters, following transformation over the last last 24 months. "After the chapter 11 filing, we will continue to meet the commitments we have made to our customers, partners and employees in the ordinary course of business, subject to Bankruptcy Court approval, as necessary", Kennedy said to its suppliers.

To be fair, there were rumors in the media that Avaya was going to file for bankruptcy whether it sold its contact center business or not.

The company's received a big vote of confidence for the move from Citibank, which underwritten a $725 million financing facility to help the company through the re-jigging of its finances. "Avaya remains in ongoing negotiations to monetize certain other assets, as appropriate, to maximize value for all stakeholders". As part of Avaya's comprehensive assessment of options to address its capital structure, expressions of interest in various Avaya assets, including its Contact Centre business, were evaluated.

Avaya Ends Speculation, Files for Bankruptcy Protection Looks to Chapter 11 restructuring as the way to position all businesses for future success, CEO says.

Avaya, which went private in 2007, has been hidebound by its roots in the telecoms hardware business and by earlier acquisitions, including the purchase of VoIP and Ethernet company Nortel Enterprise solutions in 2009.

Avaya's revenue fell to $958 million in the fourth quarter ended on September 30 from $1 billion a year earlier, according to the report.

Like much of the networking and collaboration industry, Avaya is looking toward software-defined networking, IoT, and cloud-based platforms that work on many different devices and the web. But Avaya and CD&R could not agree on price, terms or how the deal would effect Avaya's pension obligations, a person familiar with the matter said on Thursday. Avaya said it would find ways to reduce its debt load of about $6.3 billion but also revealed that it would not sell its call center business, which it had attempted to sell to Genesys for $4 billion last August.



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