Eastman Kodak has filed for bankruptcy protection in the US, and secured nearly $1bn to maintain operations during the proceedings. [Updated]
Kodak: Chapter 11 bankruptcy protection
"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 Chairman and Chief Executive Antonio M. Perez.
Earlier this month we reported that, according to the Wall Street Journal, the photography firm, which offers digital cameras and printers as well as photographic film, was making "last-ditch efforts" to sell off some of its patents in a bid to avoid having to prepare a Chapter 11 bankruptcy protection filing. Some 1,100 patents could be sold in the move, which equates to around 10 percent of its total patent library. See also: Kodak says Samsung Galaxy Tab infringes patents.
However, it appears the efforts failed and the 131-year-old company has now filed for Chapter 11. Kodak has obtained a $950m, 18-month credit facility from Citigroup to to ensure it remains afloat during bankruptcy proceedings. Kodak said the credit facility, which is subject to court approval, would "enable the company to focus on its most valuable business lines". However, there are concerns regarding what will happen to the firm's 19,000 members of staff now the Chapter 11 filing has gone ahead.
“Kodak is taking a significant step toward enabling our enterprise to complete its transformation," said Perez.
"The Board of Directors, the senior management team and I would like to underscore our appreciation for the hard work and loyalty of our employees. Kodak exemplifies a culture of collaboration and innovation. Our employees embody that culture and are essential to our future success.”
The photography firm believes the Chapter 11 filling will ensure it can maximise the value of two specific area of its portfolio, digital capture patents that are used in mobile devices and other consumer electronics that capture digital images along with "breakthrough" printing and deposition technologies. Kodak expects the reorganisation of the company to be completed by 2013.
In Q3, Kodak reported it had made a quarterly loss of $222m and marked the ninth consecutive quarter the firm has made a loss. The Wall Street Journal's predictions saw Kodak's shares take a hit, falling 28 percent.
However, the firm says sales of printers and consumables in Q3 were 44 percent up on the same time last year. Despite this, IDC says Kodak has only a 2.6 percent share of the printer market and ranks fifth in the world behind the likes of HP. Since 2003, Kodak has closed 13 manufacturing plants and 130 processing labs, and reducing its workforce by 47,000.
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Comments
Mike said: I think Kodak needed to make a new name for themselves to replace most peoples image of a film business - and needed to be very good to achieve that Perhaps they instead relied too much on their reputation and just didnt match Canon and the like
Aukmune said: Kodak had the opportunity to OWN the digital photographic world when they developed one of if not the first digital camera decades ago before anyone else but their dinosaur management said naah itll never happenFilm is the way forward for ever and stuck to their guns even while they were losing their share of markets and ultimately billions of dollarsFuji were also in the same boat being the 2nd biggest film manufacturing company but they saw the digital tsunami coming and just a couple of years later very bravely adopted the as then unknown quantity of digital photography look where they are in comparison now
Johnyboy said: A guy in Comet told me they have more Kodak printers back than any other make - cheap but not so cheerful perhaps
Malc Tulloch said: I bought a Kodak scannerprinter amp had nothing but trouble with it for 9 months I took it back to PC World amp changed it for a Canon printer I should have bought the Canon first off amp avoided KodakIf other people have problems like me Im not surprised theyre in troubleIve had an HP Photosmart 7350 for the last 12 years amp it is still going strong
Weenasty1690 said: NAW I JUST BOUGHT A PRINTER