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They're baaaack: Avaya outlasts Chapter 11
Debt restructuring checked off, $300 million in the kitty
Almost a year after filing for Chapter 11 bankruptcy protection, Avaya last Friday announced the process has completed.
During the restructure, the company exited the networking business, selling that operation to Extreme Networks for $100 million. That left Avaya able to focus on its contact centre business (a good thing, since it had tried to sell that operation to Genesys but didn't get a bite).
Making the announcement, CEO and president Jim Chirico said the company now has “a significantly strengthened balance sheet”, because “we reduced our prior debt load by approximately $3 billion, and we exit today with more than US$300 million in cash on our balance sheet.”
Compared to the 2016 financial year, he added, annual cash flow is also $300 million better off.
While the contact centre and unified communications market remains Avaya's focus, Chirico emphasised the company will be working to “complete our transformation to a software, services and cloud solutions provider.
“With a new Board and leadership team firmly in place, Avaya is now well-positioned to execute on its growth plan and deliver the returns and value expected by our stakeholders.”
The next step will be to fulfil the requirements to get listed again, on the New York Stock Exchange.
Avaya was spun off from Lucent Technologies (itself a spin-out from AT&T) in the 1990s, and went private after an $8.2 billion takeover courtesy Silver Lake Partners and Texas Pacific Group.
In 2009, Avaya it splashed out $900 million to buy Nortel's Enterprise Solutions business. That proved difficult to digest in a world swinging away from proprietary voice hardware, leading to last year's Chapter 11. ®