It has been a busy week of news from Eastman Kodak. On Monday Kodak announced that they will be asking the bankruptcy court to discontinue insurance payments for retirees over the age of 65. That will affect 16,030 current retirees. Kodak says the retirees wouldn’t lose “core health coverage” because they are Medicare eligible and the company would save $20.5 million a year. What retirees would be losing is what is known as “gap insurance,” that being the difference in what Medicare pays and the actual medical costs. EKRA, a Kodak retiree organization. plans to be at the next bankruptcy hearing scheduled for March 20th to argue against dropping the health insurance. In past cases for other companies, bankruptcy court has allowed companies to drop insurance plans for retirees. As a Kodak retiree, aged 62+ I don’t want to see that medical coverage discontinued.
Rochester Business Journal reported that at the end of 2011 Kodak had 5,129 Rochester area employees, down 780 from the end of 2010. That means that Kodak employs less than Xerox and is now out of the top five largest private-sector employers in the Rochester area. The year end number of employees for Kodak world wide was 17,081. Another 91 Kodak employees will be losing their jobs over the next few weeks as a result of Kodak’s decision to drop sales of digital cameras.
On Thursday Kodak announced that they will be selling their Kodak Gallery website. On that website you can store and share photos. You can also print photos, photo books and other photo related items. Kodak says they have 75 million users. Kodak was offered $23.8 million by rival Shutterfly. Under bankruptcy law this will be considered a minimum bid and other companies have an opportunity to bid greater. Most of the time, there isn’t a better offer during these kind of sales under bankruptcy. Current Gallery users who do not want their photos transferred to Shutterfly will get the chance to opt out of the transition. Those users could retrieve their images through free downloads or purchase DVDs from Kodak.
Kodak is discontinuing three color slide films; E100VS, E100G and Elite Chrome Extra Color 100. Kodak says they have enough inventory to last for 6 – 9 months. I am not sure if that means that Kodak will be left producing any slide films or not. If you know; add a comment.
Kodak power plant in building 312 north of Weiland Road needs a major upgrade. It uses coal to generate power to all 35 companies using Eastman Business Park (formerly Kodak Park). That plant has reduced emissions greatly over the years but currently does not meet government standards. Kodak has until 2014 to meet the standards or close down the power plant. Kodak had a potential buyer of the plant in US Renewable Group but they backed out after learning about the needed upgrades. Estimates for the upgrade are between 40 and 60 million dollars. Bankruptcy only complicates the possibilities of seeing the upgrades completed in time.
Kodak is still trying to sells about 1,100 digital patents. Estimates of the value of those patents are from 1 to 3 billion dollars. That sale is expected to get under way by June 30. One problem with the sale is that Apple will ask the bankruptcy court to allow them to sue Kodak for patent infringement. Kodak also has a patent infringement case pending against Apple. Hopefully bankruptcy protection can help Kodak complete the sale of their patents.