Eastman Kodak Corp., the once-mighty photography company responsible for putting amateur photography in the hands of the average consumer, has been approved by a federal bankruptcy judge to emerge from their Chapter 11 proceedings, according to sources. The emergence marks a new chapter in the long and storied history of one of America’s signature companies.
Chapter 11 Results in Rebranding
As a result of the bankruptcy proceeding, which took the better part of a year and a half and cost the company many of its assets, Kodak will be rebranded as a digital imaging leader, with expected profits less than half of what they once were. It is almost strange to think of the iconic company being all but unaffiliated with cameras; after all, it was founded by photography pioneer George Eastman in 1880 as a commercial outlet for his hand-held camera. But the company was late to the digital camera revolution, resulting in plummeting profits and a Chapter 11 filing in January of 2012 with total debts on the books of nearly $7 billion.
According to a bankruptcy attorney close to the case, much of this debt was back pension owed to retired employees, which has been discharged in the filing, putting many former employees out of what was owed to them. The bankruptcy attorney says that Kodak did not want to have to put the burden on pensioners, but was stymied when it could not get the expected value for a series of patents they had tried to sell. Instead the patents became the subject of an intense legal battle with Apple Inc., and they sold for nearly $1.5 billion less than expected.
Kodak hopes to emerge from Chapter 11 with a new focus and a new energy, according to the bankruptcy attorney.