Photography firm Eastman Kodak Company and its U.S. subsidiaries have filed for Chapter 11 to boost liquidity, monetize non-strategic intellectual property and fairly resolve legacy liabilities.
Kodak, which expects to complete its U.S.-based restructuring during 2013, has also got a $950 million debtor-in-possession credit facility with an 18-month maturity from Citigroup to enhance liquidity and working capital. Meanwhile, non-U.S. subsidiaries outside are not subject to this chapter 11 proceedings.
Chapter 11 refers to the section of the U.S. Bankruptcy Code that provides a company with the opportunity to restructure under court supervision while continuing normal day-to-day business operations.
Kodak is taking a significant step toward enabling our enterprise to complete its transformation, said Antonio Perez, Chairman and Chief Executive Officer.
Kodak has been reorganizing its businesses since 2003 to focus more on its digital business, which accounted for about 75 percent of its revenue in 2011. The company has already effectively exited certain traditional operations, closed 13 manufacturing plants and 130 processing labs, and slashed its 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, said Perez.
The company and its Board 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.
Kodak, which filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York, will be filing monthly operating reports with the Bankruptcy Court.