Tuesday, September 3, 2013

Eastman Kodak Exits From Bankruptcy

Photography pioneer Eastman Kodak has emerged from their 2012 bankruptcy filing as a much smaller entity this week. Instead of selling film or photography products to consumers, the latest incarnation of Kodak will focus mainly on commercial printing as well as touch-screen sensor components for tablets and smartphones.

The new, smaller Kodak has shed the cameras, film sales and consumer photo developing that made it a household name, focusing on printing technology for corporate customers, touch-screen sensor components for smartphones and computer tablets, and film for the movie industry. U.S. Bankruptcy Judge Allan Gropper last month approved Kodak’s exit plan, which cut about $4.1 billion of debt and left shareholders empty-handed.

“This is a totally new company,” Antonio Perez, Kodak’s chairman and chief executive officer, said in an interview. “When we created the new portfolio we were very aware of the fact that we were going to be late coming into this market. The only way that you could be successful coming in late is to come into the market with breakthrough technologies and very differentiated value propositions, and this is what we have.”

The new Kodak -- excluding units that have been sold or spun off -- will report about $2.5 billion in revenue in 2013, Perez forecast. It will have $167 million in earnings before interest, tax, depreciation and amortization, he said.

The Kodak brand remains “very valuable” in the imaging industry and will remain lucrative through licensing deals, Perez said.

“If it has to do with imaging, Kodak is a very strong brand all over the world,” he said.

Perez will continue as CEO for another year, or until his successor is elected. He will serve as a special adviser to Kodak’s board for up to three years, the company said in July.
Kodak's unsecured creditors received anywhere from 4¢ to 5¢ on the dollar and purchased shares in the emerging company through a rights offering. During the bankruptcy proceedings, Kodak sold off digital imaging patents for roughly $525 million to Samsung, Apple, Google, Amazon, Research In Motion, Facebook, HTC and Microsoft.

Earlier this year, Kodak spun off their personalized and document imaging to it's UK pension plan in a deal to settle nearly $3 billion in claims against the company. It also reached a deal with the state of New York to resolve environmental liabilities by contributing $49 million towards a trust. After trading for nearly 107 years on the New York Stock Exchange, Eastman Kodak was de-listed in January 2012 immediately after their bankruptcy filing.

Kodak was formed in 1888 in Rochester, NY by George Eastman who devised a business strategy where his company would sell relatively inexpensive cameras and making profits on items like paper, chemicals and film. The company became the dominant player photographic equipment and supplies company throughout the 20th century, although both Kodak and Japanese rival Fujifilm began steadily losing market share to digital photography after 2000.

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