Avaya Finally Exits Chapter 11, Channel 'Focusing On the Future'

Avaya has emerged from chapter 11 bankruptcy as a public company with about $350 million in cash and a little less than half the debt it had when it filed last January.

Early this month, the U.S. Bankruptcy Court for the Southern District of New York confirmed Avaya’s second amended reorganization plan. Its debt load now totals about $2.9 billion, down from about $6 billion.

Avaya’s Gary Levy

Gary Levy, Avaya’s vice president of U.S. channels, tells Channel Partners this is the beginning of a new chapter for his company and “we’re focusing on the future.”

“That means we’re increasing both the speed of innovation and the delivery of our next-generation solutions, and that’s important because we’re looking to enable our customers and partners to be more competitive,” he said. “It’s important that our customers have our solutions and our partners are competitive in the marketplace. We will be a public company for the first time in more than a decade, which really has significantly strengthened our balance sheet and cash flow, giving us more flexibility to pursue growth through both innovation and other investments.”

Avaya has what it takes to become a stronger competitor in the enterprise communications and collaboration realm if it continues to execute intelligently, said Alaa Saayed, information and communication technology principal analyst in Frost & Sullivan’s digital transformation division. The company “strongly displayed its powerful implementation skills to quickly and cleverly emerge from chapter 11, reshaping into a a more efficient new organization structure,” he said.

“The new Avaya is showing signs of increasingly focusing its efforts on key growth areas while shying away from declining markets in the enterprise communications and collaboration realm,” he said. “Main themes in 2018 will be growing the company’s cloud engagement, growing overall service/software growth, focusing on tailored vertical solutions, and continuing to invest in evolving and new technologies such as CPaaS, team collaboration, artificial intelligence (AI) and UCaaS, in general.”

Avaya starts this new chapter with a new board of directors and a new management team in place, Levy said.

“So we’re well positioned to execute on our growth plan and certainly increase value for our stakeholders,” he said. “Since filing last January, we’ve actually signed more than 4,000 major contracts with new and existing customers. We’ve recruited over 1,000 partners globally and pretty much reinvigorated our sales force. And we’ve invested over $225 million in R&D, which is well ahead of expectations. What’s interesting here is that the customer momentum and the partner momentum really signify the trust that folks have in Avaya so that we’re continuing to build on …

…  our partnerships. We have about 6,300 channel partners and about 130,000 customers around the world, both large and small, who pretty much rely on us to create those outstanding experiences for their customers.”

The 2018 Avaya Edge partner program is ready to accommodate partners as Avaya exits chapter 11 and into the new year, Levy said.

“We really focused the program on the benefits of the prior year, which were loyalty and growth of strategic products, but also enhanced the cloud offerings and the rebates for new customers,” he said. “We enhanced that part of the program so it’s already in place today and our partners have been working toward that program now. That’s exciting because our partners who are adopting our cloud technologies in the midmarket enterprise space will really benefit from some lucrative awards and rewards around cloud adoption, as well as new customers as we move forward.”

When it filed for chapter 11 in January, Avaya decided not to sell its call-center business.

“That decision was very well-received by the partner community,” Levy said. “And the combination of the new technologies in both the contact center and unified communications space is going to greatly advantage our partners at Avaya moving forward.”