Eastman Kodak said Wednesday night that it has filed for Chapter 11 bankruptcy. The expected move shows that no technology or business franchise lasts forever, no matter how enduring it seems.
Kodak failed to make the transition from film to digital imaging, after years of trying. It couldn’t stave off the filing even though it filed patent lawsuits in recent days against Apple, HTC and Samsung.
But the Rochester, N.Y.-based company isn’t calling it quits. It hopes to emerge from bankruptcy proceedings in 2013 continue its business with $950 million in financing from Citigroup. Kodak said it named Dominic DiNapoli, vice chairman of FTI Consulting, as chief restructuring officer. (That’s an unusual title).
The filing in U.S. bankruptcy court in the southern district of New York is intended to bolster liquidity for the company in the U.S. and abroad and help it focus on its latest investments in products.
Kodak said it will continue to pay employee wages and benefits and continue customer programs. Subsidiaries outside the U.S. are not subject to the proceedings.
“Kodak is taking a significant step toward enabling our enterprise to complete its transformation,” said Antonio M. Perez, chairman and chief executive officer, in a statement. “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.”
He added, “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.” He said the board unanimously backed the Chapter 11 filing.
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