MediaFile

Tech wrap: Kodak files for bankruptcy protection

Eastman Kodak, the photography icon that invented the hand-held camera, filed for bankruptcy protection and planned to shrink significantly after a prolonged plunge for one of America’s best-known companies. The Chapter 11 filing may give Kodak the ability to find buyers for some of its 1,100 digital patents, a major portion of its value. According to papers filed with the U.S. bankruptcy court in Manhattan, Kodak had about $5.1 billion of assets and $6.75 billion of liabilities at the end of September. Kodak now employs 17,000 people, down from 63,900 just nine years ago.

Kodak’s long decline can be traced back to one source: the former king of photography’s failure to reinvent itself in the digital age, writes Ernest Scheyder. Kodak’s film dominated the industry but the company failed to adopt modern technologies quickly enough, such as the digital camera — ironically, a product it invented. ”Kodak was very Rochester-centric and never really developed a presence in centers of the world that were developing new technologies,” said Rosabeth Kanter, a professor at Harvard Business School. “It’s like they’re living in a museum.”

Apple unveiled a new digital textbook service called iBooks 2, aiming to revitalize the U.S. education market and quicken the adoption of its market-leading iPad in that sector. The move pits Apple against Amazon.com and other content and device makers that have made inroads into the estimated $8 billion market with their electronic textbook offerings. Apple has been working on digital textbooks with publishers Pearson, McGraw-Hill and Houghton Mifflin Harcourt, a trio responsible for 90 percent of textbooks sold in the United States.

Google’s net revenue jumped more than 27 percent in the fourth quarter but fell short of Wall Street targets, sending shares down sharply in after hours trading. The No.1 Internet search engine said that it earned $2.71 billion, or $8.22 per share in the fourth quarter, compared to $2.54 billion, or $7.81 per share in the year-ago period.

Microsoft said fiscal second-quarter profit fell slightly, as lower computer sales hurt its core Windows business. The company reported net profit of $6.624 billion, or 78 cents per share, compared with $6.634 billion, or 77 cents per share, in the year-ago quarter.

Struggling Kodak had to pay for CEO’s vacations in Spain

Over the four years that Kodak’s stock fell 80 percent, the photography icon’s private jet made its way several times a year to Vigo, Spain — the balmy fishing town that is the hometown of CEO Antonio Perez.

The Wall Street Journal’s flight tracker for private jet travel makes it easy to trace Perez’s vacations in Spain. It also estimates that the cost of each roundtrip was more than $50,000 a pop.

Starting Jan 1, 2011, Perez’s personal trips on the jet were limited to $100,000 a year. If his flights exceed that amount, Perez has to reimburse Kodak, according to the company’s latest proxy statement. That might come as some relief to investors concerned about the rate that Kodak is burning cash.

Tech wrap: Not a pretty picture for Kodak

Eastman Kodak Co shares fell almost 70 percent on Friday afternoon on concerns the photography pioneer could file for bankruptcy.

Kodak’s stock had already hit a 38-year low earlier this week as investors worried about its cash position after the company tapped a credit line for $160 million.

Amazon.com Inc’s new tablet computer costs $209.63 to make, IHS iSuppli estimated on Friday, highlighting how the e-commerce giant is taking a financial hit upfront to get the device into as many hands as possible. Amazon’s billionaire Chief Executive Jeff Bezos unveiled the Kindle Fire at a lower-than-expected $199 price on Wednesday.

from DealZone:

KKR’s imagination

Nobody can question Eastman Kodak's intention in raising some $700 million. Getting a commitment from private equity firm Kohlberg Kravis Roberts to buy up to $400 million of its debt is also a perfectly logical step for the old-economy stalwart as it lumbers into the digital age. What KKR is thinking is another matter.

KKR says the investment reflects its belief in Kodak's strategy. They're also getting warrants in Kodak to purchase up to 53 million shares of its common stock. The Wall Street Journal says KKR could end up owning close to 20 percent of the company.

The 24/7 Wall St blog notes that the fall in Kodak's share price following the news shows the market isn't blindly convinced of KKR's intelligence. But Kodak's bonds got a boost, if for no other reason than there's a buyer out there.