Apect Files for Chapter 11 to Restructure Debt

Aspect Software, a provider of contact center, workforce optimization, and back-office systems, has filed for Chapter 11 bankruptcy to reduce its long-term debt by about 40 percent.

In filing for Chapter 11 earlier this monthy, Aspect said a capital restructuring plan backed by its creditors would eliminate about $320 million in debt. The filing also includes plans for new secured financing and an infusion of fresh convertible debt capital to facilitate growth.

"This transaction marks a major milestone in the multi-year transformation of Aspect's business," as the company moves from a provider of on-premises contact center software to a provider of contact center and workforce optimization solutions in the cloud, said Stew Bloom, Aspect's chairman and CEO, in a statement. "By resetting our capital structure and dramatically improving our balance sheet, we will be well-positioned to compete over the long-term while continuing to accelerate investments in our product and service capabilities," he said.

During the past three years, Aspect has invested $160 million in acquisitions, including its July 2013 acquisition of Voxeo for $150 million and its acquisition of LinguaSys, an interactive text response, near-real-time text translation, and natural language user interface provider, in August 2015. Aspect serves 2,200 call centers in more than 70 countries, generating annual sales of more than $400 million. The company maintains $100 million in cloud revenue backlog, driven in part by new year-over-year bookings growth of more than 20 percent in 2015.

Aspect said at the time of the bankruptcy filing that it expected the reorganization to be completed within 105 days.

In the meantime, "it is business as usual for Aspect';s customers, partners and employees," Bloom said. "Aspect will continue to operate with strong levels of liquidity during the reorganization process"