Sales and marketing

Avaya Files for Chapter 11 Bankruptcy Protection

Avaya has filed for chapter 11 bankruptcy protection in U.S. court and is not considering the potential sale of its Contact Center business at this time, the company confirmed today. Avaya vowed to continue business operations while minimizing any potential disruptions.

According to an Avaya statement: "Avaya Inc. ... today announced that it has commenced a formal proceeding to restructure its balance sheet to better position itself for the future."


Amid the filing, Avaya has obtained a committed $725 million debtor-in-possession (“DIP”) financing facility underwritten by Citibank. Subject to Court approval, this DIP financing, combined with the Company’s cash from operations, is expected to provide sufficient liquidity during the chapter 11 cases to support its continuing business operations and minimize disruption, Avaya asserted.

Avaya Bankruptcy: Call Center, Pension Plan, Asset Sales

Rumors about Avaya potentially filing for bankruptcy protection have swirled since late 2016. Also of note:

  • Avaya Call Center Business: Rumors about Avaya potentially selling its call center business have circulated. But at this time Avaya is no longer negotiating to sell that business, the company said.
  • Potential Asset Sales: Avaya remains in ongoing negotiations to monetize certain other assets, as appropriate, to maximize value for all stakeholders, the company said. Rumors suggest the negotiations involve Avaya's networking hardware business -- rather than its core unified communications assets.
  • Avaya Pension Plans: Concerns about Avaya funding its pension plans had surfaced in December 2016. Without referring directly to those pension plans, an Avaya VP in December 2016 said the company's debt was manageable and there's no reason for panic.

Ironically, the company's home page reads, "Strong Now. Stronger in the Future."

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.