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Mitel Files Chapter 11: UC Giant Seeks Fresh Start

The struggling communications company moved to restructure its debt as it focuses on making up ground lost to giants such as Zoom, Microsoft, and Cisco.

Written By: Allison Francis

Mar 12, 2025

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Mitel has officially filed for Chapter 11 bankruptcy protection to restructure its debt and “optimize its global operations.” The unified communications (UC) company has struggled to compete with industry giants like Zoom, Microsoft Teams, and Cisco Webex.

The company has reached an agreement with lenders and key stakeholders to essentially reorganize what it owes through a prepackaged bankruptcy plan. Mitel and several affiliates have submitted voluntary petitions under Chapter 11 in the Southern District of Texas.

Although Mitel’s revenues have fallen over the last few years, the company assures that its “global business will continue to operate in its normal course” throughout the restructuring process. The company also promises that vendors won’t be left hanging—they’ll still get paid. Employees can breathe easy, too, as Mitel is asking the court to let it keep paying salaries and benefits as usual.

Company aims to emerge stronger

The company hopes this financial reset will free up cash to pour into its cloud strategy and help it catch up with the big players in the unified communications space. With key backers already on board, Mitel expects to move through bankruptcy quickly and without causing headaches for customers, employees, or partners.

“For over 50 years, Mitel has pioneered and adapted to the ever-changing communications industry, shaping how organisations worldwide connect and communicate,” said Tarun Loomba, CEO of Mitel. “We are confident the steps we are taking to optimize our capital structure will make us a stronger company primed for efficient and sustainable growth. 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.”

Loomba goes on to say that the company looks forward to becoming an even stronger vendor to their customers through this process, “better positioned to power their most meaningful connections and to address the increasing preferences for hybrid communications solutions, globally.”

Debt relief on the horizon

Mitel has raised $60 million in emergency funds to keep operations running smoothly during the bankruptcy process. Once the court gives the green light, the company plans to use this money alongside its existing funds to keep the lights on day to day. Once the company has cleared bankruptcy, Mitel has already secured $64.5 million in financing to keep operations going.

This financial overhaul will reduce Mitel’s debt by a casual $1.15 billion and its yearly interest payments by $135 million, giving the company some much-needed breathing room while it recuperates.

The Chapter 11 filing only covers Mitel’s US and Canada operations and certain parts of its UK business.

The technologies that leaders will desire most in 2025 are wide-ranging, from cybersecurity solutions to Unified Communications as a Service (UCaaS) to various cloud products. Read on to learn about the future of opportunity and demand in the channel.

Allison Francis

Allison is a contributing writer for Channel Insider, specializing in news for IT service providers. She has crafted diverse marketing, public relations, and online content for top B2B and B2C organizations through various roles. Allison has extensive experience with small to midsized B2B and channel companies, focusing on brand-building, content and education strategy, and community engagement. With over a decade in the industry, she brings deep insights and expertise to her work. In her personal life, Allison enjoys hiking, photography, and traveling to the far-flung places of the world.

Mitel Files Chapter 11: UC Giant Seeks Fresh Start

Company aims to emerge stronger

Debt relief on the horizon

Allison Francis

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