toggle

AAPL Stock: 114.64 ( -3.8 )

Printed from http://www.macnn.com

Kodak braces for Chapter 11 bankruptcy if patent sale stops

updated 03:40 pm EST, Wed January 4, 2012

Kodak readying Chapter 11 filing as precaution

Kodak is drafting Chapter 11 bankruptcy filings in the event it can't sell patents in the next few weeks, insiders asserted Wednesday. The proposed plan seen by the Wall Street Journal would see the camera legend possibly enter bankruptcy later this month or in early February. The reorganization would see it get $1 billion of debtor-in-possession funding and sell its entire library of 1,100 patents through a bankruptcy auction rather than a typical process.

Citigroup, JPMorgan Chase, and Wells Fargo are said in the talks along with bondholders. Proxy talks with a third-party financing group, through Cerberus Capital Management, were also reportedly underway.

Bankruptcy could be partly deliberate and an advantage for Kodak. A lack of patent sales in the past few months has been partly blamed on buyers having jitters over Kodak going bankrupt. Along with that certainty, it could force bidders to publicly outline their bids. Some health care and retirement payouts might also go away, saving hundreds of millions of dollars from when the company was much larger.

Steps have already been taken to sell off its image sensor business and has warned that it might delist from the NYSE.

Kodak has been pushed to the brink both by its inability to fully transition to digital as well as a failed gamble on patents. The firm at one point planned to base its business on patents rather than products, licensing to LG, Motorola, and others as well as suing Apple and RIM. Its plan backfired after it didn't get the ruling it wanted and faced major delays on rulings that could see it bankrupt or even liquidated before it could see a verdict.




by MacNN Staff

toggle

Comments

Login Here

Not a member of the MacNN forums? Register now for free.

toggle

Network Headlines

Follow us on Facebook

toggle

Most Popular

Advertisement

Recent Reviews

HP 14-x030nr 14-inch Chromebook

If you're like us, chances are you've come to realize that you need the ability to access the Internet on the go. Also, you've prob ...

15-inch MacBook Pro with Force Touch

Apple's 15-inch Retina MacBook Pro continues to be a popular notebook with professional users and prosumers looking for the ultimate ...

Typo keyboard for iPad

Following numerous legal shenanigans between Typo -- a company founded in part by Ryan Seacrest -- and the clear object of his physica ...

toggle

Most Commented