Court Approves Citigroup Financing for Kodak as it Begins Reorganization
Eastman Kodak, which yesterday announced that it was seeking Chapter 11 bankruptcy protection as it seeks to reorganize, reported that the U.S. Bankruptcy Court for the Southern District of New York has approved initial availability of $650 million in interim Debtor-in-Possession (DIP) financing by Citigroup. The financing will enable Kodak to continue to pay employees, fulfill orders, pay vendors, operate all day-to-day business activities, etc.
With its Chapter 11 filing, Kodak is seeking protection from creditors while at the same time reorganizing its company, which includes generating revenue from sales of patent licenses, exiting its film business, and focusing on its digital-imaging businesses – namely commercial and consumer/office ink-jet systems, with Kodak’s CEO and Chairman Antonio M. Perez, who previously headed Hewlett-Packard’s office/consumer ink-jet division, commenting, “We will now be well-positioned to complete our transformation. Competing in large markets, where we have fundamental technology advantages, such as in digital printing, in packaging, in functional printing, in materials.”
Kodak also reported that the court approved additional “First Day Motions” which assures that ongoing business will not be disrupted. Kodak received authorization from the court to:
- Pay U.S. employees in the usual manner, including employee expenses, and to continue paying employees’ healthcare and other benefits programs without disruption.
- Fulfill all pending orders, warrantees, and other customer programs.
- Continue to use existing cash-management systems and maintain existing bank accounts.
More information about Kodak’s reorganization is available at www.kodaktransforms.com. Information for suppliers and vendors is available at (800) 544-7009 or (585) 724-6100. The court case number is 12-10202 (ALG).