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Kodak files for Chapter 11 bankruptcy

Lisa Pollack — Thu, 19 Jan 2012 09:50:10 +0000

Eastman Kodak announced early Thursday that it and its US subsidiaries filed for Chapter 11 bankruptcy, reports Marketwatch. The firm said the move “is intended to bolster liquidity in the US and abroad, monetize non-strategic intellectual property, fairly resolve legacy liabilities, and enable the company to focus on its most valuable business lines.” The press release is on Businesswire. Units of the 131-year-old company outside the US are not affected by the action and would continue to meet their obligations to suppliers, the FT reports. The filing in the US gives the company protection from its creditors while it seeks to reorganise its finances and operations. Kodak has shed 47,000 jobs and closed 13 manufacturing plants and 130 processing labs since 2003. Bankruptcy would allow the company to act more quickly to shut unprofitable operations while cutting back on its pension obligations, according to bankruptcy lawyers.

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Kodak files for Chapter 11 bankruptcy

Kate Mackenzie — Thu, 19 Jan 2012 05:41:42 +0000

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Kodak in ‘advanced’ talks with Citi on bankruptcy

Kate Mackenzie — Fri, 13 Jan 2012 04:47:37 +0000

Kodak is in advanced discussions with Citigroup to provide bankruptcy financing, Bloomberg says, citing three people familiar with the matter. Kodak may seek protection from creditors within weeks and then hold an auction to sell its patent portfolio, said the people. Two of the sources said Kodak may seek about $1bn in debtor-in-possession financing, though terms may change, and one said advisers to Kodak are lining up a bidder that will be the frontrunner or so-called stalking horse bidder for the patent portfolio should the company file.

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Eastman Kodak prepares for bankruptcy

Lisa Pollack — Wed, 04 Jan 2012 21:09:29 +0000

Citing people familiar with the matter, the WSJ reports that Eastman Kodak Co is preparing a Chapter 11 bankruptcy filing, to be used if the sale of a portfolio of digital patents falls through. The company is in discussions to try to attain around $1bn of debtor-in-possession financing to keep the company operational through the potential bankruptcy proceedings. In securities filings in November, Kodak had warned that it was in danger of running out of cash if unable to sell the patents or raise additional loans. Shares in the company fell 18 per cent since the WSJ’s report was published mid-afternoon Wednesday. Kodak has struggled to reinvent itself, moving away from film sales towards commercial and consumer printers. The company had been trying to keep cash flowing in by means of patent lawsuits and licensing deals; a strategy which has ultimately failed to raise much-needed funds.

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Lehman bankruptcy in final phase

Joseph Cotterill — Wed, 07 Dec 2011 09:58:53 +0000

A court has approved the remnant of Lehman Brothers to exit bankruptcy early next year, allowing pay-outs to creditors to begin soon after, reports Reuters. Lehman has some $65bn of assets under its three-year liquidation plan to meet the $450bn claims of its creditors. Judge James Peck called the bankruptcy the “most impossibly challenging” ever in approving the plan in court, Bloomberg says. Senior bondholders of Lehman will get 21.1 cents on the dollar back under the plan, compared to 16 cents in a rival proposal put together by creditors of Lehman’s affiliates.

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MF Global accessed client funds for weeks

Kate Mackenzie — Fri, 02 Dec 2011 03:34:09 +0000

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AMR files for bankruptcy protection

Izabella Kaminska — Wed, 30 Nov 2011 10:18:28 +0000

AMR Corporation, the parent company of American Airlines, filed for bankruptcy protection on Tuesday in an effort to shed its crippling debt burden and reduce its costs after losing ground to competitors over the past decade, the FT reports. Gerard Arpey, AMR’s long-serving chief executive, is also to retire, the company said. The filing ends of months of speculation about the future of the third-largest US carrier. Its shares have slumped after a run of quarterly losses even as its peers returned to profitability. American chose to forgo bankruptcy protection in the early 2000s while its rivals used the process to shed their pension plans and reduce structural costs, leaving it at a substantial disadvantage. Since then, companies such as United Airlines and Delta Air Lines, have only increased their lead. The two American rivals have trimmed their fleets, redesigned their networks and leapfrogged American through big mergers and acquisitions.

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State to take over after Harrisburg’s bankruptcy voided

Lisa Pollack — Fri, 25 Nov 2011 10:05:00 +0000

The decision by a judge on Wednesday to throw out the bankruptcy filing of Harrisburg, Pennsylvania leaves the state poised to take over the finances of the beleaguered city. A group of city councillors had filed the Chapter 9 petition to protect the city from creditors. However, such an action was not consistent with established procedures that require all branches of the municipality “to be on the same page”, said Judge Mary France in court. The city’s major, state leaders, and bondholders had challenged the filing, which is now the 82nd municipal bankruptcy since 1980 that has been thrown out shortly after filing, the WSJ reports.

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Some client funds of MF Global to be returned

Lisa Pollack — Fri, 18 Nov 2011 10:34:39 +0000

A judge in the US approved the transfer of about $520m of MF Global customer funds on Thursday. The transfer represents 60 per cent of the $869m held in the accounts and will begin in about a week, the WSJ reports. This will also involved the transfer of some 22,000 client accounts to new dealers. There is a rising suspicion among those investigating the case that MF Global did not keep its clients’ accounts segregated but rather used the funds in them to meet margin calls in the days leading up to their bankruptcy filing. Using client assets in this way is something that is prohibited by the Commodity Exchange Act. The WSJ quotes a source as saying the MF Global had been using client assets during the trading day, but was returning it at the close. Something, however, went wrong with the transfers in the last few days that the firm was trading, according to the source.

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A flood of subpoenas for MF Global

Lisa Pollack — Thu, 17 Nov 2011 09:54:29 +0000

Chicago US Attorney Patrick Fitzgerald and New York US Attorney Preet Bharara have been busy issuing subpoenas in an effort to track down $600m in missing client funds at failed brokerage MF Global. A number of subpoenas were already issued in the immediate aftermath of the bankruptcy with the aim of preventing any records from being destroyed or lost. The Justice Department and FBI are also conducting criminal investigations into the collapse of the firm, though to date no one has been charged. In bankruptcy court on Wednesday, a lawyer for MF Global said they were being besieged by requests for information, reports the WSJ. Meanwhile, the CFTC is prioritising the return of client funds above all else. The office of the trustee sought permission on Tuesday night from the bankruptcy court to release some $520m to clients whose accounts have been frozen.

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