Avaya Files for $1 Billion IPO

NEW YORK (TheStreet) -- Avaya took the first step toward a return to the public markets on Thursday as the Basking Ridge, N.J.-based provider of business communications software and equipment filed with the Securities and Exchange Commission for a new $1 billion stock offering.

The company was spun off by Lucent Technologies in 2000 and then bought out by private equity firm Silver Lake Partners and TPG Capital for more than $8 billion in 2007. Reports of its plans to go public surfaced earlier this week.

In Thursday's S-1 filing, Avaya said it plans to use the proceeds to pay down long-term debt, redeem preferred stock, and pay monies related to the termination of a management agreement with Silver and TPG. The company said its total debt as of March 31 sat at $6.18 billion.

Avaya disclosed a loss of $615 million, or $1.26 a share, for the six months ended March 31 on revenue of $2.76 billion in the filing.

The company also said Silver Lake and TPG hold warrants to purchase 100 million shares at an exercise price of $3.25 each. These warrants are subject to various lock-up agreements, but must be exercised prior to Dec. 18, 2019.

Joint bookrunners for the deal are Morgan Stanley(MS), Goldman Sachs(GS), and JPMorgan Chase(JPM), along with Citigroup Global Markets, Deutsche Bank Securities, BofA Merrill Lynch, Barclays Capital, UBS Investment Bank and Credit Suisse Securities (USA) LLC.

--Written by Michael Baron in New York.

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