Global unified communications player Mitel Networks Corporation has gone bankrupt.
The Canada-headquartered company has found it tough going in the unified communications market against the likes of Zoom, Microsoft 365 and Cisco.
Mitel says it has entered into an agreement with an “ad hoc group” of its senior lenders, “certain junior lenders”, and other “key stakeholders” to “recapitalise its debt”.
The Chapter 11 bankruptcy process it has chosen will allow Mitel to “right-size” its capital structure, and allow it to “invest in its long-term business strategy”.
It says it will continue to support more than 70m end users at companies across over 100 countries. The Chapter 11 process covers operations in the US, Canada and some in the UK.
Mitel says it will “fulfil” its go-forward commitments to customers, partners, and other stakeholders. “Mitel expects this to be a swift, streamlined process with minimal disruption to customers, employees, vendors, or partners,” it adds.
Tarun Loomba, chief executive officer of Mitel, added: “Our strengthened capabilities at the end of this process will ensure our ability to continue to support customers and partners with innovative solutions, incorporating emerging technologies, and meeting their evolving needs for secure, reliable communications solutions for years to come.”
The firm confirmed: “Mitel’s operations outside of the US, Canada, and select business segments in the UK are not included within the Chapter 11 filing. Mitel’s global business will continue to operate in its normal course.”
With the help of new financing from lenders, Mitel is aiming to “deleverage” around $1.15 billion from its balance sheet, and to reduce its annual cash interest expense by approximately $135m.
