Kodak Document Imaging Sold to... Kodak
Saturday, May 04, 2013
Though it was widely reported to be sold to Brother, we learned today that Kodak's Document Imaging and Personalized Imaging business units have been sold to Kodak's U.K. Pension Plan in a surprise move.
Matthew Daneman of the Rochester Democrat and Chronicle broke the news by reporting: "The last two big items on Eastman Kodak Co.'s bankruptcy to-do list — settle a shortfall of nearly $3 billion in its United Kingdom pension plan and sell a pair of businesses — are being handled in one fell swoop, as Kodak hopes to sell those businesses to the pension fund."
Industry veteran Ralph Gammon of the newsletter Document Imaging Report commented, "The big news over the past couple months has been the reported - or should I say mostly misreported, sale of Kodak Document Imaging (DI) to Brother... and then two weeks later, Kodak announcing that DI and Kodak Personalized Imaging (PI) had been sold to Kodak's U.K. Pension Plan (KPP). Yes, that's what happened. (Note: I was not surprised that someone outbid Brother's $277 million offer for DI, which is reportedly a $400 million-plus, profitable business. I just didn't expect it to be a Kodak organization.) The KPP deal certainly seems like a much better one for Kodak Corporate, as it really takes care of multiple needs: the need to sell DI and PI, as well as the need to settle with KPP, who was listed as Kodak Corporate's largest unsecured creditor. And the sale to KPP seems like a good thing for DI as well, in terms of both stability and better positioning it for growth in the future."
In Daneman's article, KPP Chairman Steven Ross is quoted as saying: "We could afford to step in, turn this on its head, see how we could use the sale to their benefit... and give people long-term stability so the opportunities in these businesses could be realized... What we'll do is put a holding company in place. The holding company will have a board that consists of executives and non-executives — I imagine I'll be one of those. (Will the pension plan) meddle in day-to-day operations? I don’t think so. We will be a positive, friendly shareholder."