http://www.marketwired.com/press-release/avaya-files-plan-of-reorganization-and-disclosure-statement-2209832.htm
4 replies (most recent on top)
There is no way the creditors will accept the plan as written. They absolutely do not wan to own Avaya in a debt for equity deal. It's not what they signed up for and at this point - especially with Avaya's business declining - they just want out. There is a very low probability that the company can deliver the ROI that the creditors will want and it isn't free to own a company. Someone needs to run it profitably and that costs money. It's important to understand the market dynamics - no one want software UC when it's all cloud these days. Avaya will continue to decline and the creditors know this. Bottom line is that the leadership thinks they can strong arm the creditors by delaying and trying to push their agenda, but every month that passes it becomes more clear that the company is destined for failure. The creditors will force the courts to liquidate the assets and thereby get a better return. If the creditors were on board, this would never have gone to bankruptcy in the first place. The company is o.v.e.r.
At least they put it up for a vote. If it doesn't go through, there is always chapter 7 and asset liquidation, should the creditors choose not to take the debt-equity swap.
The plan is to reduce the current deb from 6billion to 2billions and use whatever cash they can get from Networking sale to pay some of the debts and interests.
SilverLakes has been in charge in running Avaya a ground, not sure they will still be involved.
With this swap, the creditors have a chance to boot the entire BoD and KK in a flash if they are not happy with business. That's the only positive thing of this restructuring plan
Creditors will never agree to this plan. They already said No to this plan that why Avaya ask for another 120 days from court on the plans.
Great news this was always short term pain for long term gain