Kodak stock plummets amid bankruptcy fears

Manufacturer of first commercial camera in 1888 has struggled in digital era, failing to turn a profit since 2007.

    Kodak has struggled with the move to digital cameras and failed to turn a profit since 2007 [EPA]

    Kodak's shares have slumped amid growing speculation that the iconic photography firm could file for bankruptcy.

    But after its stock lost more than half its value on Friday, the New York-based company said it had "no intention of filing for bankruptcy".

    Kodak, which delivered the first consumer camera in 1888, said it was committed to meeting its obligations and was still looking for ways to "monetise" its patent portfolio.

    The company confirmed it had hired Jones Day, a law firm that specialises on bankruptcies and other restructuring alternatives, but said it was one of several advisers it was consulting after losing nearly $1.8bn since 2007.

    "It is not unusual for a company in transformation to explore all options and to engage a variety of outside advisers,'' Kodak said.

    American icon

    The photography pioneer has struggled with the move to digital cameras and failed to turn a profit since 2007. It has been exploring a sale of its digital imaging patents, worth an estimated $2bn.

    Its shares plunged as much as 68 per cent to 54 cents on Friday before recovering slightly to close down 54 per cent at 78 cents on the New York Stock Exchange.

    The company's market value plummeted to roughly $210 million, down from the height of $31 billion in February 1997. Also, the cost to insure Kodak's debt with credit default swaps surged as investors priced in greater bankruptcy risk.

    Kodak has been a hallmark of American business. The company's history stretches back to inventor George Eastman's Eastman Dry Plate Company in 1881. By 1885 he had introduced the the first transparent photographic film. The "Kodak" camera hit the market in 1888, with the slogan, "You press the button - we do the rest."

    It rolled out Kodachrome, the first commercially successful amateur colour film, in 1935.

    In recent years, the company has relied on licensing of patents related to photography and printing, as well as sales of commercial and consumer printing systems.

    SOURCE: Agencies


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