This may not be a very happy New Year for Kodak, as the 131-year-old company is reportedly preparing to seek bankruptcy protection in the coming weeks. According to the Wall Street Journal, Kodak is in the midst of selling its digital patents to raise some last-minute capital.
The WSJ's sources say that if the patent portfolio sales don't succeed, Kodak has started talking to banks about some $1 billion in financing to tide it over during bankruptcy proceedings.
Sources also say that the filing could come sometime this month or early February, and that Kodak would continue to pay its bills and operate as normal while under bankruptcy proceedings. But the company's focus would then be on the sale of about 1,100 patents through a court-supervised auction.
The WSJ article reads:
"That Kodak is even contemplating a bankruptcy filing represents a final reversal of fortune for a company that once dominated its industry, drawing engineering talent from around the country to its Rochester, NY headquarters and plowing money into research that produced thousands of breakthroughs in imaging and other technologies. The company, for instance, invented the digital camera -- in 1975 -- but never managed to capitalize on the new technology."
Kodak's shares fell about 28 percent to 47 cents on the New York Stock Exchange. If it cannot increase its share price over the next six months, the NYSE has warned that it may delist the company. Speculation of imminent bankruptcy was further sparked when Kodak announced the resignation of three directors last week. It also hired restructuring firm FTI, an organization known for dealing with bankruptcy.
The full report from the Wall Street Journal is available here.
An interactive slideshow featuring the history of Kodak can be found here.
