Thread regarding Avaya layoffs

Announced a termination package last week and revised it downward today because too many people opted in and they felt they could screw them even more. Awesome place to work!

Mandate passed today by executive leadership:

1. Hire new brains across all locations - low salary and they have potential to bring new ideas.

2. In US fire people with salary greater than 200K.

3. Hire new brains in India and fire Indians who have worked greater than 8-10 years in Avaya. Younger Indian employees are more productive than older ones. Older employees are already given sufficient time to prove themselves but now they are just a liability to the company, its time to identify and fire them.

4. Sufficient notice needs to be given to employees as per regional company policy so that there's no legal issues.

Notice going out today, 4/28/16, about massive layoff. Avaya is looking to get rid of 2,000 - 2,500 people. Everyone with a minimum 2 years service will be asked to leave with a few weeks salary. This is definitely a sinking ship. Sad part is Kevin Kennedy, Jim Chirico, and others are still sucking millions of dollars out of the company annually. They also continue to ship jobs out of the country. All to feed the top a ton of money to take this company down. If you are not looking for another job already, take your head out of the sand.

I was layer off this week. Have them 10 years and the might give me 4 weeks. 10 years of loyalty ends in 2 minute conversation. I pray this company implodes. It's going to like the titanic. So many people working on dead products never get Layed off. It's a shame how they treat their employees. They forced me to take traing about travel and expenses, really ? They won't let us expense a pencil. These poor bastards are all doomed. I feel sorry for all the good guys. Especially in the ER dept. the 1st shift escalation manager has his bald head rammed so far up his a$$ he doesn't care about all the families these layoffs will effect. All you poor bastards better move to India cause that's where all the jobs will be

Mid level management always try to be more politically correct and ground reality never matches with leadership vision hope it gets better before it is too late.

I fear if it is another sinking ship as nothing is working for Avaya. Only option they have is reduce cost by layoff. I wish it gets acquired by a financially strong company to leverage it's technology.

What is most troubling about this situation is that Kevin Kennedy (Current Avaya CEO) may not have the opportunity to exercise any of his leadership skills or business strategies in the face of the mounting debt.

Avaya’s S-1, filed earlier this year states the following:

“Our degree of leverage could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, expose us to interest rate risk to the extent of our variable rate debt and prevent us from meeting obligations on our indebtedness.”

“Our degree of leverage could have important consequences, including:

making it more difficult for us to make payments on our indebtedness;

increasing our vulnerability to general economic and industry conditions;

requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, thereby reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities;

exposing us to the risk of increased interest rates as borrowings under the senior secured multi-currency asset-based revolving credit facility and the senior secured credit facility are at variable rates of interest;

limiting our ability to make strategic acquisitions;

limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; and

limiting our ability to adjust to changing market conditions and placing us at a competitive disadvantage compared to our competitors who are less highly leveraged.”

Leadership already launched new company called Zang. They are planning to sell Avaya's best product via Zang. Few employees working on these products will be moved to this newly formed company. Left over employees would be asked to leave and/or company will file bankruptcy and it will be sold to buyers. This change is already started and will heat up soon. HR organization within the company has already experienced layoffs of few big shots. Leave if you have a better option

Is this a rumor? Nothing major heard about massive layoffs so far....

Avaya- a technology company that sells collaboration, audio conferencing, video conferencing among other products made an announcement recently. All employees NOT in direct sales must report to the nearest Avaya office by the end of March 2016. They will be monitored and must be there 3 of the 5 working days unless there is an excused absence. So for many, they will need to travel a crazy distance only to be then forced from a cubicle to conference call or video call with the people they engage with today. That is because most offices are filled with IT staff, or people not in a given employees sphere. This is a smokescreen to layoff more people as it was stated if you do not do this,(report to an office), you WILL be terminated. A manager I know admitted that this is a smokescreen. Interesting times as avaya continues to shrink their way to greatness

So the news is confirmed, there will be reduction of 4k employees in coming 15 days of April'16. This will be Avaya's biggest layoff in their history so far.

Services are most likely to get hit along with IT & other BU's

New York, February 12, 2016 -- Moody's Investors Service ("Moody's") downgraded Avaya, Inc.'s corporate family rating to Caa1 from B3. Moody's also downgraded the company's probability of default rating to Caa1-PD from B3-PD, its first lien debt facilities to B2 from B1 and its second lien notes to Caa2 from Caa1. The downgrade was driven by continued declines in performance as well as concerns about the sustainability of the current capital structure including its ability to refinance $600 million of debt maturing in 2017. The ratings outlook is negative.

Ratings Rationale

The Caa1 corporate family rating reflects Avaya's very high leverage (greater than 8x as of December 31, 2015) and concerns about the sustainability of the capital structure. The rating also reflects the company's very high debt service and other requirements at a time when the enterprise telephony market is evolving. Debt service, pension service and capital requirements of the business leave little cushion to support unforeseen operating challenges or to make material debt repayment or critical acquisitions. The rating acknowledges the company's industry leading position within the enterprise telephony market and related unified communications markets. At the same time the industry is evolving to include integrated communications offerings, with products offered as either on premise or hosted, managed service solutions. Avaya will need to constantly reinvest in new products and platforms to maintain its position against Cisco, its much larger and better capitalized primary competitor as well as smaller cloud based competitors. Although the company continues to make strides in reducing the cost structure of the business, revenues are expected to continue to decline and it will be challenging to materially improve EBITDA levels in the near term.

The current capital structure is particularly problematic given the changes underway in the unified communications market. In addition to changes in the architectures of corporate communications systems, the increasing preference for subscription based pricing models hurts near term revenues, profitability and cash flow. Though the subscription model or managed service contracts can be beneficial in the long run, the near term hit to performance is particularly challenging when debt levels are high and liquidity is limited. Moody's continues to expect Avaya will be a key long term player in the industry and given sufficient time, with the appropriate capital structure, EBITDA levels will stabilize and potentially improve.

While the company could likely limp along if all maturities were pushed out to 2020, the current capital structure is impractical and at worst, prevents some customers from choosing Avaya.

Liquidity is adequate over the next twelve months but unlikely sufficient to address $600 million in maturities due in October 2017. Liquidity is supported by a $335 million domestic and $150 million foreign ABL lines ($196 million available as of December 31, 2015) as well as cash of $344 million. The company is expected to have modest but very limited free cash flow over the next eighteen months.

The negative outlook reflects Moody's expectation for declining revenues and concern that the company may face challenges in refinancing 2017 and 2018 debt maturities .

The ratings could be downgraded if leverage were to exceed 9x or free cash flow were negative on a sustained basis. The ratings could be upgraded if the company can stabilize revenues and EBITDA and address its capital structure, including pushing out maturities and improving leverage levels to under 7x.

The following ratings were affected:

Downgrades:

..Issuer: Avaya, Inc.

.... Probability of Default Rating, Downgraded to Caa1-PD from B3-PD

.....Corporate Family Rating, Downgraded to Caa1 from B3

....Senior Secured 1st Lien Bank Credit Facilities, Downgraded to B2 (LGD2) from B1 (LGD2)

....Senior Secured 1st Lien Regular Bond/Debenture, Downgraded to B2 (LGD2) from B1 (LGD2)

....Senior Secured 2nd lien Regular Bond/Debenture, Downgraded to Caa2 (LGD5) from Caa1 (LGD5)

Outlook Actions:

..Issuer: Avaya, Inc.

....Outlook, Negative

The principal methodology used in these ratings was Diversified Technology Rating Methodology published in December 2015. Please see the Ratings Methodologies page on www.moodys.com for a copy of this methodology.

Avaya is a global leader in enterprise telephony systems with $4.0 billion of revenues for the LTM period ended December 31, 2015.

REGULATORY DISCLOSURES

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this rating action, and whose ratings may change as a result of this rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

Matthew B. Jones

Vice President - Senior Analyst

Corporate Finance Group

Moody's Investors Service, Inc.

250 Greenwich Street

New York, NY 10007

U.S.A.

JOURNALISTS: 212-553-0376

SUBSCRIBERS: 212-553-1653

Lenny J. Ajzenman

Associate Managing Director

Corporate Finance Group

JOURNALISTS: 212-553-0376

SUBSCRIBERS: 212-553-1653

Releasing Office:

Moody's Investors Service, Inc.

250 Greenwich Street

New York, NY 10007

U.S.A.

JOURNALISTS: 212-553-0376

SUBSCRIBERS: 212-553-1653

Yes, big layoff announced internally effective 3/31/2016

More layoff before end of march, quarter end

A lot more layoffs to come very soon and big numbers. After completely f---ing up a good company with layers of management doing nothing but covering there ass, they are now looking to flatten the management structure and finally remove a few layers, no doubt they will make a complete mess of that, but more fun times ahead for Avaya....numbers being finalised this week in all areas. No one too sure if it's global or US only but it will be pretty big, they are haemorrhaging cash.

In a letter today from Pierre Paul allard sent on 3/2/16 at approx 7:20 pm he announced layoffs as we move to streamline our way to a software business. Also some exciting,(his description) accouncements which are basically renaming of existing products.

No information on timing or numbers but it sounds like the ones being laid off have been told