Telecommunications company Avaya Inc. on Thursday (January 19, 2017) said that it has filed petitions under chapter 11 of the U.S Bankruptcy Code to reduce its current debt.
“We have conducted an extensive review of alternatives to address Avaya’s capital structure, and we believe pursuing a restructuring through chapter 11 is the best path forward at this time,” said Avaya CEO Kevin Kennedy in a press release.
Avaya also announced that it has obtained $725 million debtor-in-possession (DIP) financing by Citibank to continue business operations and minimize disruption. In addition, the company decided against selling its Contact Center business as it believes that focusing on the company’s debt is “paramount.”
The company notes that the bankruptcy filing is a “critical step” in its transformation from a hardware company to software and services business.
(Photo Source: avaya.com)