Avaya shuffles leadership ranks as it works towards Chapter 11 exit

Avaya shuffles leadership ranks as it works towards Chapter 11 exit

New CEO set to step in from October

Avaya’s chief operating officer and global sales lead, Jim Chirico, is set to step up as the company’s next chief executive officer, effective 1 October 2017.

Kevin Kennedy, the networking and telecommunications vendor's current president and CEO, will step away from the role and will no longer be a member of the board, but has agreed to remain as an advisor to the company.

Chirico, meanwhile, will step up to the board.

The leadership shuffle comes as the company, which filed for Chapter 11 bankruptcy in the United States in January, files an amended plan of reorganisation in its chapter 11 cases, supported by a majority of holders of its first lien debt.

“Today's filings pave the way for Avaya's near term exit from chapter 11 and our return as a publicly traded technology company,” Kennedy said.

“The company will exit this process with an industry leading financial model preserved throughout the restructuring process, reduced complexity following the divestiture of our Networking business, strong innovation across our portfolio and commercial execution that exceeded the Avaya Business Plan,” he said.

Avaya Australia and New Zealand managing director, Peter Chidiac, said that while Avaya Inc. has been working through the Chapter 11 process in the US, the A/NZ business has progressed strongly.

“This agreement provides a clear and viable path to exit Chapter 11 in line with our strategy,” Chidiac said. “This is an important milestone as we work to emerge as a strong and competitive company in the coming weeks.”

“Over the last two years, we have been vocal about the transformation of the A/NZ business; we recognised the need to restructure in order to align to the demands of the A/NZ market and deliver software and services that local organisations need and ensure the success of our customers,” he said.

Chidiac revealed that, last year, Avaya A/NZ closed its fiscal 2016 with its strongest quarter in 12 quarters, with the business building from there. 

“I am pleased to note this progress has continued, with the local business to date,” he said.

Avaya also revealed its preliminary third fiscal quarter 2017 revenue, which is expected to be in the range of US$802 to US$804 million, a decline of nine per cent from the third quarter of the prior year.

The company’s adjusted pre-tax earnings (EBITDA) are expected to be in the range of US$202 million to US$206 million, or 25.1 per cent to 25.7 per cent of revenue.

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