ROCHESTER, N.Y. — After weeks of speculation, Kodak and its U.S. subsidiaries officially filed voluntary petitions for Chapter 11 business reorganization.
The company, which submitted the filing in the U.S. Bankruptcy Court for the Southern District of New York, said the decision is "intended to bolster liquidity in the U.S. and abroad, monetize nonstrategic intellectual property, fairly resolve legacy liabilities and enable the company to focus on its most valuable business lines." Earlier this month, Kodak unveiled a new corporate structure, which included the consolidation of its three business units into two, the creation of the chief operating office and related executive appointments.
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. Kodak expects to complete its U.S.-based restructuring during 2013.
“Kodak is taking a significant step toward enabling our enterprise to complete its transformation,” Kodak chairman and CEO Antonio Perez said. “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,” Perez said. “Our goal is to maximize value for stakeholders, including our employees, retirees, creditors, and pension trustees. We are also committed to working with our valued customers.”