Eastman Kodak

Doubtlessly we’ve seen the news that illustrious company Kodak is in serious trouble. Eastman Kodak, which has struggled to switch its business from film cameras to digital, has filed for Chapter 11 bankruptcy. Kodak is getting a $950 million credit line from Citigroup to help sustain its operations while it reorganizes.

Kodak has a number of changes underway to raise money and cut cost. They hope to sell off a major of its patent portfolio to raise some cash, which did not go well as they expected. Digital camera business is shutting down and they selling its online Kodak Gallery operations (Rochester, 2012). They said their home photo printers, high-speed commercial inkjet presses, workflow software and packaging as the core of its future business. So far there are thousands of jobs cut down to save money from the head-count reductions, including costs for compensation and benefits according to the report on Wall Street Journal (Mattioli, D 2012). Compared with a few decades ago, the company has been down to just 20% of the employee count (Schweber, 2012).

In November 2012, the loans worth $830 million will be offered to Eastman Kodak Company in a new financing package by a committee of 10 institutional investors who all hold senior secured notes in Kodak (Associated Press, 2012). This money will help the company to complete the reorganization and emerge from bankruptcy protection in the first half of 2013.

The current situation is caused by several reasons.

Firstly, Kodak tried to ignore the new technology and refuse to see even a short distance view of the future. Kodak was on the watch list for a long time so that it is the reason why Kodak did not transition to the digital age. Even decades ago, they were the first commercial company to invent the working prototype of the digital camera and digital camera fitted in a phone (Grayson 2012). But the company did not act when the