Sell-off of Avaya product lines a real possibility if Chapter 11 filing occurs, says analyst

Spread the love

news that Avaya Holdings Corporation, May filing for Chapter 11 bankruptcy protection imminently means that both channel partners and corporate clients are anxiously watching what will happen next.

Should the filing expire, “part of Avaya’s Chapter 11 filing requires simplification of their product lines,” Thomas Randall, advisory director at London, Ont.-based Info-Tech Research Group, told TODAY. “Both channel partners and customers are looking at whether parts of Avaya will be sold (for example, their contact center solutions) to meet financial objectives, or whether some products will be pushed to the end of life from lack of R&D investment. Will reach.”

News of the pending bankruptcy protection plan first appeared in The Wall Street Journal on Thursday informed of that “the company is approaching a Chapter 11 bankruptcy filing to transform its business and reorganize its balance sheet to address past accounting problems.”

Shares of the company fell today at the end of trading US$0.15from a high share price of US$21.65 earlier this year.

According to Randall, “A lot will be attractive to potential buyers of the Avaya product lines – Avaya still maintains a huge customer base. The question will be whether Avaya remains merely paint on a solution operated by another provider, or Avaya The brand will disappear entirely from the sale. RingCentral already powers Avaya’s UCaaS solution – will another vendor (such as Microsoft) decide to acquire Avaya’s contact center solution for ease of market?

At the end of the day, he said, another concern to consider is the customer experience: “With so many layoffs and the inability to meet certain cloud deployment deadlines, Avaya customers and channel partners are reaching the point of jumping ship.” Can

“Modernizing from on-premises legacy communications to cloud-based solutions is a difficult process. But, if that step is taken, the infrastructure is in place for customers to perform a cloud-to-cloud migration. Cloud-to-cloud migration services also present a market opportunity for channel partners to grow.

Another hurdle revolves around the fact that the trust between partners won’t be high, Randall said: “Having already been through a Chapter 11 voyage five years ago, Avaya has to address its partners at its 2018 Engage conference. Had to rally.

“Channel partners are now probably asking, ‘What’s different this time? How can I be assured that the product line I’m selling will be here next year? What communication should I be giving to my customers?’ As of now, the communication still remains unclear and will likely remain pending till the filing.

a reuters Article The Wall Street Journal reported later that the company was “in talks with its financial stakeholders regarding a comprehensive resolution to strengthen its balance sheet.”

In a statement issued on December 13, Avaya’s Chief Executive Officer (CEO) Alan Masarek said, “Considering with all financial stakeholders of the company to enhance our capital structure, increase liquidity and accelerate our investments in innovative products- Discussions are on.” Solution.”

Source link

Spread the love

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.