Kodak Accepts $830 Million Financial Deal from Steering Committee for Interim

November 29, 2012 No Comments

kodak bankruptcyOn November 28, American company Eastman Kodak announced that it finally accepted and received the offer of Steering Committee of the Second Lien Noteholders Committee for interim worth $8300 million. The commitment replaced the $793 million offer of Centerbridge Partners, GSO Capital Partners, UBS and JPMorgan.  According to the official press release of Kodak, “This financing strengthens Kodak’s position to successfully execute its remaining reorganization objectives and emerge from Chapter 11 in the first half of 2013.”

It is stated that the senior secured notes of the company are in the hands of the ten institutional investors of Steering Committee while the improved financing will be open to investors by all other holders of the notes which includes the investors that extended their November 12 commitment.

It was also stated in the press release that the “financing includes new money term loans of $455 million, as well as term loans of up to $375 million issued to holders of senior secured notes participating in the new money loans in a dollar-for-dollar exchange for amounts outstanding under the company’s pre-petition second lien notes.”

The commitment of Kodak to  Steering Committee for interim and improved financing wasn’t something surprising since it was reported that it was way back in 2007 that the company made a profit and was struggling in the industry since then, resorting to generate revenues through aggressive patent litigation. The business slow downfall rumors was even proven to be true when they filed for Chapter 11 bankruptcy protection early this January and was followed by their announcement of exiting the digital image capture business, phasing out its production of digital cameras in the market in February. It was also in the same month that they sold their Image Sensor Solutions (ISS) division to Trusense Imaging Inc. They stated that their exit was to focus on the production of their home photo printers, high-speed commercial inkjet presses, workflow software and packaging. But in September 28, it was altered when Kodak announced its plans to stop selling inkjet printers in 2013 and will focus on commercial printing, but also said that they will still sell Kodak inks for their printers.

“The improved financing commitment provides a longer maturity, lower fees and pricing, and greater liquidity than our previously announced commitment,” said Antonio M. Perez, Chairman and Chief Executive Officer. “This is a vote of confidence in the future of our company. We are particularly pleased that the financing allows for participation by all of our pre-petition second lien noteholders in a manner that is cost-effective for the company.”

Sources: Kodak News & Media | Photo Courtesy by Google Images

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