A U.S. Bankruptcy Judge has approved Kodak’s plan to emerge from the oversight of the court. This paves the way for it to become a much smaller company that is mainly focused on commercial and package printing.
The plan that the judge approved renews the company’s hopes to reinvent itself.
Most of the old Kodak is long gone, including its business of making cameras. It was unable to keep up with the switch to digital technology. This is especially true since attention seems to be focused on the cameras that are in cell phones.
In Minnesota, there are a number of businesses that have seen themselves have to file bankruptcy and emerge as something completely different so that it can maintain at least its name and some of its workforce. Some companies have been able to grow in new industries under a new name. This is something that a number of Minneapolis business bankruptcy attorneys and various others throughout the state have witnessed.
Since it had to file bankruptcy, Kodak has had to sell off many of its patents and businesses while shutting down the unit that manufactures cameras. It was this unit that made it famous many years ago.
It has been said that the business plan that Kodak submitted to the court does not include anything to do with consumer photos.
What Kodak is going to be making is equipment that prints labels for commercial products.
In 2003, Kodak’s revenue for that year was over $13 billion, but by 2011, it had dwindled down to $6 billion.
The plan that has been approved by the court affects retirees, creditors, and shareholders. All of the existing stock will be canceled out and a whole new generation of shareholders will come about. The expected investors are a large number of financial institutions.
As it stands, creditors are scheduled to get about 4 cents for every dollar. Many former workers will lose their health care and retirement benefits.
At one time, Kodak employed around 65,000 people in Rochester, Minnesota. The new Kodak will employ approximately 2,000 people.
The Associated Press has reported that the U.S. Trustee filed an objection with the court that challenged the legality of hefty stock and cash bonuses that the Kodak executives are expected to receive when the company is released from bankruptcy protection.