Kodak Wants to Keep Water Flowing, Lights On
By: Cierra Putman
Updated: January 24, 2012
ROCHESTER, NY - Kodak filed a motion in federal court Tuesday to make sure it can pay its utility bills. Their utility costs run about $6 million a month.
The company released a more detailed plan on how it plans to reorganize. Financial experts say this is standard for a company going through bankruptcy. The motion would prevent its 125 providers from turning off services and make Kodak set aside money to pay off the bills. The company still owes about $3 million in utilities.
A judge has to approve the motion and a public lender presentation which outlines how it plans to restructure. Kodak plans to make 60 percent of its company commercial. The other 40 percent will be consumer and oversee digital devices, intellectual property and more. Financial expert Brennan Redmond of Brighton Securities said the report shows the company has lost hundreds of millions of dollars since last year. He doesn't think lenders will be happy with the plan.
"I think they have a lot more steps to take and this is just the first salvo," Redmond said. "I think the bond holders and a lot of the creditors of Kodak will come back and tear this apart and I think they're going to have a pretty easy time doing it. So, we'll see how it ultimately turns out. There's no way to know for sure, but the plan seems to be pursuing the same strategy that they've been trying to pursue ever since Perez took over. It hasn't gained traction over the past six, seven years."
Redmond said the presentation also leads him to believe more bad news could be in store. He thinks the company will probably make layoffs and could make cuts to retiree benefits in about year.
The company released a more detailed plan on how it plans to reorganize. Financial experts say this is standard for a company going through bankruptcy. The motion would prevent its 125 providers from turning off services and make Kodak set aside money to pay off the bills. The company still owes about $3 million in utilities.
A judge has to approve the motion and a public lender presentation which outlines how it plans to restructure. Kodak plans to make 60 percent of its company commercial. The other 40 percent will be consumer and oversee digital devices, intellectual property and more. Financial expert Brennan Redmond of Brighton Securities said the report shows the company has lost hundreds of millions of dollars since last year. He doesn't think lenders will be happy with the plan.
"I think they have a lot more steps to take and this is just the first salvo," Redmond said. "I think the bond holders and a lot of the creditors of Kodak will come back and tear this apart and I think they're going to have a pretty easy time doing it. So, we'll see how it ultimately turns out. There's no way to know for sure, but the plan seems to be pursuing the same strategy that they've been trying to pursue ever since Perez took over. It hasn't gained traction over the past six, seven years."
Redmond said the presentation also leads him to believe more bad news could be in store. He thinks the company will probably make layoffs and could make cuts to retiree benefits in about year.
