The US Bankruptcy Court for the Southern District of New York today approved Kodak’s previously announced comprehensive settlement agreement with the UK Kodak Pension Plan (KPP), the company’s largest single creditor with respect to its Chapter 11 Plan of Reorganization. In approving the agreement, the Court described it as “a critical step forward in Kodak’s effort to consummate its Plan of Reorganization.” With the agreement, announced on April 29, Kodak’s Personalized Imaging (PI) and Document Imaging (DI) businesses will be spun off under the ownership of KPP.
“We have been working in close cooperation with KPP to achieve a smooth transition for our PI and DI employees and customers to a new owner – one who clearly recognizes the value of these businesses and intends to help them grow and succeed,” said Antonio M. Perez, Kodak Chairman and Chief Executive Officer. “We look forward now to completing our reorganization and emerging as a company focused on Commercial Imaging.”
Steven Ross, Independent Chairman of the Kodak Pension Plan, said, “I am delighted that the court has approved the settlement involving the transfer of the PI and DI businesses to KPP. This is by far the best option available for KPP, which is acquiring two profitable businesses that will provide substantial ongoing income to the fund. The income that these two businesses generate will enable KPP to remain outside of the Pension Protection Fund (PPF) and to offer our members a new pension plan that will provide all of them with better benefits than they would have received in the PPF. I am pleased to say that the feedback the Trustees are receiving from members at presentations currently being held around the UK is highly encouraging. I look forward to working alongside the management and staff of the PI and DI businesses - who have remained loyal and focused during this process -- as we build a firm future for them and for our members.”
The consummation of the KPP settlement is expected to occur after confirmation of the company’s Plan of Reorganization. Earlier this week, Kodak proposed rights offerings, an agreement with New York State on Eastman Business Park, and the engagement of arrangers for new financing, all key steps toward the confirmation of the company’s Plan of Reorganization and emergence.