Unable to sell 1,100 digital imaging parents that could have rescued it and running short of cash, Eastman Kodak has filed for Chapter 11 bankruptcy protection.
The iconic Rochester, NY-based company, founded by photograph pioneer George Eastman in the 19th century, is assuring employees that the company will continue to operate with “business as usual” during the bankruptcy process, stating that Kodak “expects to pay employee wages and benefits.”
“After considering the advantages of Chapter 11 at this time, the board of directors and the entire senior management team unanimously believe that this is a necessary step and the right thing to do for the future of Kodak,” CEO Antonio M. Perez said in announcing the decision.
The filing listed assets of $5.1 billion and debts of $6.75 billion. As of a year ago, Kodak had 7,100 employees in the Rochester area and 18,800 companywide. The worldwide figure is now 17,000, the company said in its bankruptcy papers, about 8,000 of them in the U.S. It did not give a new Rochester-area figure. At its peak in the early 1980s, the company employed 62,000 people in Rochester and 130,000 worldwide. Kodak also has about 25,000 retirees in the upstate NY region.
The filing was made in the Southern District of New York, a common location for major bankruptcy cases. Citigroup Inc.. one of the largest banks in the U.S., has committed to providing Kodak with a $950 million credit line to help sustain the company’s operations while it reorganizes its finances. Kodak said it expects to continue operating its businesses while in Chapter 11, “and to continue the flow of goods and services to its customers.”
Greater Rochester’s economic development chief issued a statement indicating that the region has for several years been diversifying its industrial base, spinning several new businesses out of the original Kodak complex. Here is a link to a video statement from GRE’s Mark Peterson about the impact of Kodak’s bankruptcy filing – http://youtu.be/hVfvNyMtf84.