ConvergeOne, an IT company based in Bloomington, has filed for Chapter 11 bankruptcy in an effort to eliminate 80% of its $1.8 billion debt.

The plans, filed in Texas, will also transfer control of the company to senior lenders in the form of 96% of ConvergeOne's equity.

"[ConvergeOne] is proactively taking steps to reduce our debt levels, strengthen our overall liquidity profile and, in turn, invest in near-term growth and grow market share," CEO Jeffrey Russell said in a statement.

According to filings, ConvergeOne has $21.4 million of cash on hand and had revenue of more than $1.5 billion last year. Founded in 1993, the company — which has technology used for business services, cybersecurity and customer interactions — employs more than 3,000 people globally with locations in New Jersey, India and Minnesota. It plans to operate business as normal during the bankruptcy proceedings.

The current state of the economy, including stubbornly high inflation, was a major factor behind the bankruptcy filing.

"The company's highly leveraged capital structure has resulted in significantly higher cash interest costs in the current interest rate environment," the company noted in a disclosure statement filed with the bankruptcy. "The company has been forced to divert an increasing amount of cash for rising interest payments on its funded debt."

ConvergeOne also outlined other issues in the disclosure statement that put pressure on the bottom line, including "customer delays resulting from the financial distress of one of its leading technology partners in the second half of 2022 and the first half of 2023." That resulted in "staggered and diversified customer contracts and product and software purchasing patterns," according to the statement.

The company had gone public in 2018 through a merger with a special purpose acquisition company, but the next year affiliates of CVC Capital Partners, a private equity firm based in Luxembourg, acquired it for $1.8 billion and took the company private again.