kodak film camera

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Eastman Kodak has filed for chapter 11 bankruptcy in New York.(See the full press release below.)

For months, shares of the ubiquitous film company have been under immense pressure as traders speculated the company would soon file for bankruptcy.

This speculation was amplified on September 30, when the Wall Street Journal reported that Kodak had hired Jones Day for restructuring advice. This move reaked of bankruptcy.

Days later, Kodak denied the bankruptcy rumours in a statement that was riddled with caveats.

News was quiet for around a month.  Then Kodak exacerbated everyone’s fears when it released its third quarter financial results.  It reported a horrific net loss on falling revenue.  The company confirmed that it was bleeding cash.  And it also slashed its revenue and earnings guidance.

After that, things were quiet through the balance of the year.

Then on January 4, the Wall Street Journal once again reported that Kodak was preparing for a bankruptcy filing.  Just the day before, the company was notified by the New York Stock Exchange that EK shares would be delisted if they did not soon trade above $1 per share.

On January 10, investors were given some hope when management announced it had restructured the company’s businesses in an effort to cut costs and boost liquidity.  The stock soared on the news.

Days later, Bloomberg reported that Eastman Kodak had met with Citigroup to provide emergency bankruptcy financing, citing unnamed sources.  That was Friday.

And at 12:22 AM this morning, this announcement crossed the wires…
January 19, 2012 12:22 AM Eastern Time

Eastman Kodak Company and Its U.S. Subsidiaries Commence Voluntary Chapter 11 Business Reorganization

Flow of Goods and Services to Customers to Continue Globally in Ordinary Course

Non-U.S. Subsidiaries Are Not Included in U.S. Filing and Are Not Subject to Court Supervision

Company Secures $950 million in Debtor-in-Possession Financing in U.S.

Kodak’s Reorganization to Facilitate Emergence as Profitable and Sustainable Enterprise

ROCHESTER, N.Y.–(BUSINESS WIRE)–Eastman Kodak Company (“Kodak” or the “Company”) announced today that it and its U.S. subsidiaries filed voluntary petitions for chapter 11 business reorganization in the U.S. Bankruptcy Court for the Southern District of New York.

    “Kodak is taking a significant step toward enabling our enterprise to complete its transformation”

The business reorganization is intended to bolster liquidity in the U.S. and abroad, monetise non-strategic intellectual property, fairly resolve legacy liabilities, and enable the Company to focus on its most valuable business lines. The Company has made pioneering investments in digital and materials deposition technologies in recent years, generating approximately 75% of its revenue from digital businesses in 2011.

Kodak has obtained a fully-committed, $950 million debtor-in-possession credit facility with an 18-month maturity from Citigroup to enhance liquidity and working capital. The credit facility is subject to Court approval and other conditions precedent. The Company believes that it has sufficient liquidity to operate its business during chapter 11, and to continue the flow of goods and services to its customers in the ordinary course.

Kodak expects to pay employee wages and benefits and continue customer programs. Subsidiaries outside of the U.S. are not subject to proceedings and will honour all obligations to suppliers, whenever incurred. Kodak and its U.S. subsidiaries will honour all post-petition obligations to suppliers in the ordinary course.

“Kodak is taking a significant step toward enabling our enterprise to complete its transformation,” said Antonio M. Perez, Chairman and Chief Executive Officer. “At the same time as we have created our digital business, we have also already effectively exited certain traditional operations, closing 13 manufacturing plants and 130 processing labs, and reducing our workforce by 47,000 since 2003. Now we must complete the transformation by further addressing our cost structure and effectively monetizing non-core IP assets. We look forward to working with our stakeholders to emerge a lean, world-class, digital imaging and materials science company.”

“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,” Mr. Perez continued. “Our goal is to maximise value for stakeholders, including our employees, retirees, creditors, and pension trustees. We are also committed to working with our valued customers.

“Chapter 11 gives us the best opportunities to maximise the value in two critical parts of our technology portfolio: our digital capture patents, which are essential for a wide range of mobile and other consumer electronic devices that capture digital images and have generated over $3 billion of licensing revenues since 2003; and our breakthrough printing and deposition technologies, which give Kodak a competitive advantage in our growing digital businesses.”

Mr. Perez concluded, “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.”

Kodak has taken this step after preliminary discussions with key constituencies and intends to work toward a consensual reorganization in the best interests of its stakeholders. Kodak expects to complete its U.S.-based restructuring during 2013.

The Company and its Board of Directors are being advised by Lazard, FTI Consulting Inc. and Sullivan & Cromwell LLP. In addition, Dominic DiNapoli, Vice Chairman of FTI Consulting, will serve as Chief Restructuring Officer to support the management team as to restructuring matters during the chapter 11 case.

More information about Kodak’s Chapter 11 filing is available on the Internet at Information for suppliers and vendors is available at (800) 544-7009 or (585) 724-6100.

Kodak will be filing monthly operating reports with the Bankruptcy Court and also plans to post these monthly operating reports on the Investor Relations section of The Company will continue to file quarterly and annual reports with the Securities and Exchange Commission, which will also be available in the Investor Relations section of