September 03, 2013 12:01pm PT by Carolyn Giardina
Kodak Emerges From Bankruptcy
Eastman Kodak -- the company synonymous with motion picture film -- emerged from Chapter 11 on Tuesday, following completion of the final steps in the restructuring process.
“We have emerged as a technology company serving imaging for business markets -- including packaging, functional printing, graphic communications and professional services,” Antonio M. Perez, chairman and CEO of Kodak, said in a released statement, adding that the company is “leaner, with a strong capital structure, [and] a healthy balance sheet..”
Founded in 1880, Eastman Kodak Co. filed for bankruptcy protection early last year after struggling with increasing competition, the shift from film to digital, and debt.
“The motion picture film business will continue to be part of the company’s future,” asserted Andrew Evenski, president of Kodak Entertainment & Commercial Films. “We are manufacturing film, we’ve inked contracts with six studios, labs around the world are dedicated to quality service, and, most importantly, filmmakers are choosing film. Kodak’s entertainment imaging represents a stable and profitable division of the company. Moving forward, I am confident in our ongoing ability to provide value to the motion picture and television industries, which has been our honor to serve for so many years. We are grateful to our customers and partners for standing by Kodak throughout this process.”
The motion picture industry has already made significant moves from film toward digital from production through projection and distribution, but there are also filmmakers including Chris Nolan and J.J. Abrams who remain committed to celluloid. Film also remains a standard for archiving.
With Tuesday’s news, Kodak has completed all final steps in its Chapter 11 restructuring, including the spin-off of its Personalized Imaging and Document Imaging businesses to Kodak Pension Plan, a longstanding pension plan of Kodak’s U.K. subsidiary. The company also closed on its agreement for $695 million in term exit financing, paid off its DIP lenders and second lien noteholders in full and completed its rights offerings, receiving approximately $406 million of new equity investments from participating unsecured creditors.
All previously issued and outstanding shares of Kodak common stock were canceled, as were all other previously issued and outstanding equity interests. Kodak issued shares of a new class of common stock to participants in the rights offerings and will issue additional shares to unsecured creditors. Kodak expects to make initial distributions on account of general unsecured claims by the end of September.