Eastman Kodak Company said on Monday that it has reached an agreement to sell its imaging business to Japanese document imaging company Brother Industries, Ltd. for $210 million. The sale is part of Kodak's efforts to restructure and pull itself out of Chapter 11 protection -- which it filed in January 2012 – by September. Part of the effort has included selling its digital-imaging patents for $527 million, and settling outstanding patent litigation.
Under the terms of the agreement, Kodak will seek U.S. Bankruptcy Court approval of the bidding procedures at a hearing in late April. Kodak is targeting final court approval of a transaction in June, but the company is also open to accepting a higher or better offer for the business by another party other than Brother.
"Kodak’s ability to continue to explore alternatives during the marketing period will ensure that Kodak obtains the maximum value for the business," the company said on Monday. "Consummation is also subject to satisfying customary closing conditions, including required regulatory approvals."
According to Kodak, its Document Imaging business, part of its overall Personalized Imaging (PI) department, includes scanners, capture software and services. Brother is a leading global manufacturer of laser, label and multi-function printers, as well as fax machines and sewing machines. If acquired, Brother will assume deferred service revenue liability of the business, which totaled approximately $67 million as of December 31, 2012.
"This proposed sale is another key step in Kodak’s path to emergence – it moves us closer to realizing our strategic vision for Kodak’s future," said Antonio M. Perez, Chairman and Chief Executive Officer. "A sale to Brother, should they prevail, would represent an excellent outcome for Document Imaging’s customers, partners and employees."
In January Kodak said the reorganization will enable the company to bolster liquidity in the U.S. and abroad, monetize non-strategic intellectual property, and "fairly resolve legacy liabilities. It will also enable Kodak to focus on its most valuable business lines, AKA its Commercial Imaging business.