$793 million deal arranged with several creditors
San Francisco, CA -- (SBWIRE) -- 12/05/2012 -- Following an agreement with several of its creditors, the Eastman Kodak Co., parent company of Kodak, announced on November 13 that it will be able to exit bankruptcy proceeding by the middle of 2013.
The bankrupt photographic and imaging company, based in Rochester, New York, said that it had secured $793 million in funding from some of its creditors, including JPMorgan Chase & Co., GSO Capital Partners, UBS AG (UBSN), and Centerbridge Capital Partners.
Those companies are providing Kodak with second-lien credit financing, which will be used during bankruptcy and can also be partially used as funds for the company.
The agreement still requires court approval, but is conditional on Kodak selling its patent portfolio for $500 million or more. That is something that Kodak said it is sure will occur.
Progress in the sale of two business units, as well as the resolution of the company's pension obligations in the United Kingdom, are also conditions of the sale in order for the company to converting the debt for use by the Kodak.
Earlier this year, nearly 4,000 job reductions were announced by the company's Chief Executive Officer Antonio Perez. In addition, the company has been selling off a number of businesses to help fund its turnaround following the initiation of Chapter 11 protection in January. Among the businesses that Kodak is parting with include its commercial-scanner, consumer-film, and photo-kiosk businesses. Additionally, the company is attempting to auction off its digital-imaging patents sand it shutting down its consumer inkjet printer sales.
"The additional liquidity from this financing will enable Kodak to accelerate its momentum," Perez said in the statement. "It establishes a clear path for our emergence as a stronger, more focused company."
Kodak filed for bankruptcy protection following a number of years where it lost money in the wake of digital photography's popularity, which eroded its film business. Kodak has laid off 47,000 employees since 2003, and several businesses including closing 13 factories that produced film, paper and chemicals, and 130 photo laboratories.
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