kodakfilm Kodak files reorganisation petition with US Bankruptcy Court

Kodak has announced that it has filed voluntary petitions for reorganisation with the US Bankruptcy Court in efforts to protect it from impending bankruptcy.

Kodak has announced that it has filed voluntary petitions for reorganisation with the US Bankruptcy Court in efforts to protect it from impending bankruptcy.

 
The move will see additional liquidity pumped into its business, with a $950 million debit-in-possession credit facility made by Citigroup, which has a maturity duration of 18 months.
 
Kodak is seeking to protect its two most valuable businesses, its digital capture patents and its printing division. The camera sector itself is largely an area that Kodak is no longer viable in.
 
Kodak said it expects to be able to pay employee wages and benefits, and to continue customer programs. It said that its US operations should not be overtly affected, and that foreign operations are not subject to this proposal and will thus operate as normal.
 
kodakfilm Kodak files reorganisation petition with US Bankruptcy Court
 
Kodak has been steadily losing money since the industry moved from film to digital. Rivals adopted the new format, but Kodak delayed the switch, which has brought the company almost to its knees. Now 75 percent of its business comes from digital, but that hasn't stopped its overall revenue and stocks from plummeting.
 
“After considering the advantages of chapter 11 at this time, the Board of Directors and the entire senior management team unanimously believe that this is a necessary step and the right thing to do for the future of Kodak,” said Antonio M. Perez, Chairman and CEO of Kodak. “Our goal is to maximize value for stakeholders, including our employees, retirees, creditors, and pension trustees. We are also committed to working with our valued customers.
 
The company has already attempted a painful restructure by closing 13 manufacturing plants and 130 processing labs, as well as axing 47,000 employees since 2003. The company expects restructuring to complete in 2013, and will file monthly operating reports with the Bankruptcy Court between now and then.
 
Recently the company sued Apple and HTC, claiming that they infringed some of its camera patents, a move which many saw as a last-ditch effort to pull in some extra funds to keep the company alive.