Kodak Bankruptcy Plan Approved: Reorganization Begins After 19-Month Wait
Eastern Kodak Co. has been approved for a Chapter 11 bankruptcy reorganization plan, signaling a new beginning for the once-dominant photo company.
Kodak's financial struggles date back to the 1990s when the Rochester, N.Y.-based company failed to make a full adjustment to the digital age. The company that was once growing exponentially is now downsizing with a goal of revolutionizing the way it operates.
The news this week comes 19 months after the company filed for bankruptcy. Kodak will soon be free to operate independently, without the oversight its transactions have been subject to for that year and a half period.
Kodak CEO Antonio M. Perez expressed his optimism for the future of the company, telling USA Today that Kodak's "emergence is now imminent."
Perez gave a brief preview of things to come as he laid out a plan for the future.
"Next, we move on to emergence as a technology leader serving large and growing commercial imaging markets -- such as commercial printing, packaging, functional printing and professional services -- with a leaner structure and a stronger balance sheet."
Kodak has trimmed costs, restricted operations and more in the process of downsizing.
Considering the company's struggles in the last decade, nothing is guaranteed to improve. But heading into the week, Kodak announced that it had already convinced creditors that their new plan would be successful. Several creditors have already signed off on it.
U.S. Bankruptcy Court Judge Allan Gropper, who approved Kodak's plan, told USA Today that many people are losing retirement benefits and that "many are finding their recovery as a creditor is just a minute fraction of what their debt is from Kodak."
"[Kodak's] decline and bankruptcy is a tragedy of American economic life," he said.
The court decision does not mean that bankruptcy is officially over; Kodak said it hopes to close by Sept. 1. Once Kodak closes on the deal, it will go ahead and close an entire chapter and the company will be free to be independent again.
Kodak will never be the same again, but maybe a new look will help kick-start the new beginning.