Just 76 days after filing for bankruptcy, Avaya has exited Chapter 11 protection.
During this period, Avaya gained approval for its pre-packaged plan to repay creditors and rearrange its bills.
In doing so, the vendor chopped its debts down from $3.4BN to $800MN, now due in 2028.
The move also freed up $600MN in liquidity, which will fuel its "innovation without disruption" plans.
Utilizing this free cash flow, Alan Masarek, CEO of Avaya, aspires to create a more prosperous future for customers and employees.
"Today, we turn the page and enter a new future for Avaya, our people, and our customers," he said. "We are excited to fully realize the hard work we’ve put into our business transformation."
We are moving ahead with significant financial resources to accelerate investment in our portfolio as we continue delivering innovation without disruption to our customers.
Such a statement shows how far Avaya has come under Masarek’s leadership.
Indeed, shortly after he took over in August, the company warned investors there was "substantial doubt about the company’s ability to continue as a going concern."
Now, the enterprise communications’ stalwart moves forward as a private company with a brighter outlook, cash in hand, and a new board of directors at the helm.
Although, the journey to this point has proven anything but smooth sailing.
Navigating Through Choppy Waters
As Desmond Tutu once said: “Hope is being able to see that there is light despite all of the darkness.” And, for Avaya customers and employees, it often seemed tricky to spot that hope, with many stories telling a tale of doom and gloom.
Lawsuits against the former CEO, shareholder pushback after its stock suddenly became worthless, and market rivals – including NICE – perpetuating the bad news came as sharp thorns in Avaya’s side.
To make matters worse, some shareholders were Avaya employees – who likely earned stock as part of purchase plans and rewards.
Moreover, we’ve been here before. Indeed, the business previously filed for Chapter 11 bankruptcy in 2017, taking almost a year to break those bounds.
Thankfully, the process took only 76 days this time – within Avaya’s 90-day target (cue the “practice makes perfect” quips).
In addition, an entirely new board of directors will manage the transition, another factor that may make those rays of hope shine a little brighter for Avaya’s team.
Who Will Be Steering the Ship Forward?
Avaya announced a board reshuffle alongside its bankruptcy departure, with only Masarek preserving his position at the top table.