History in the making…..
There was big news on Wednesday that Kodak wants to end its retiree health care and benefits at the end of the year. This is a result of negotiations between a retiree committee that was set up by the Bankruptcy Court and Kodak. This all depends on the approval of the Bankruptcy Judge after a hearing on October 29th.
Kodak says in their filing that retiree benefits cost the company approximately $10 million per month. If you want to read the filing; it is at this PDF file. Kodak says this will agreement will affect approximately 56,000 retirees and surviving dependents.
In the agreement, Kodak will give $7.5 million to support a new beneficiary association, $635 million in an unsecured claim and an administrative claim in the amount of $15 million.
As a Kodak retiree, I, along with other retirees are disappointed in this agreement as we will be losing all our remaining medical benefits. It appears that the retiree committee didn’t win anything out of this deal. The $635 million is an unsecured claim that would be paid when Kodak comes out of bankruptcy. Those kinds of unsecured claims are currently being traded for 15 cents on the dollar. Plus Kodak could only send out information on retiree insurance plans for 2013 after the Bankruptcy Judge agrees to the plan. So we are have little time to decide on our future insurance, especially seeing as Kodak has said that more details will be available in December.Our medical costs will increase dramatically.
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On Friday, Kodak said it has made significant progress in restructuring and is now ready to begin discussions with key creditor groups on reorganization. Kodak is staking their future on commercial digital printing, commercial imaging graphics, entertainment and commercial films. This week Kodak had their commercial digital printers on display at “Graphic Ezpo” in Chicago. They even have said that thus part of their business is growing. They also say they are still trying to sell their digital patents and consumer films.