Business, Finance & Economics

Eastman Kodak's bonds fall as firm files for bankruptcy


Eastman Kodak announced today that it had filed for protection under Chapter 11 of the US bankruptcy code, along with its US subsidiaries.


Guy Solimano

Eastman Kodak bonds dropped this morning after the 131-year-old firm filed for bankruptcy protection, Bloomberg has reported, with the imaging company’s $250 million in 7.25 percent senior unsecured notes due November 2013 falling 4.25 cents to 28.75 cents on the dollar.

The notes’ value has plunged from 86.5 cents at the end of August, and from par in April, as the company – which invented the hand-held camera and brought photography to the masses – struggled to keep pace with competitors like Canon and Hewlett-Packard, who adapted more quickly to the digital era with digital cameras and printers.

Earlier this month the New York Stock Exchange warned Kodak that it could be delisted if it failed to get its stock price back over $1 per share. The firm fell out of the Dow Jones Industrial Average of 30 top US companies in 2004, according to the BBC.

Today the firm announced that it had filed for protection under Chapter 11 of the US bankruptcy code, along with its US subsidiaries – a unanimous decision by its board.

Units elsewhere will unaffected by the move, Kodak said, and will continue to meet their obligations to suppliers, according to the Financial Times.

More from GlobalPost: Eastman Kodak, storied American camera maker, files for Chapter 11 bankruptcy

The firm had recently moved away from cameras towards manufacturing printers, in an attempt to stem falling profits, the BBC reported.

Its chairman and CEO Antonio Perez said that Kodak had cut 47,000 jobs and shut down 13 manufacturing plants and 130 processing labs since 2003, the Financial Times reported, but its overall sales have plummeted too rapidly to replace them with new businesses.

Banks, hedge funds and other investors are reported to have traded a net $788.8 million of protection against a default by Kodak as of Jan. 13, according to the Depository Trust & Clearing Corp.

More from GlobalPost: Kodak contemplating Chapter 11 bankruptcy