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Kodak avoids Chapter 11 bankruptcy, but for how long?

For years, Eastman Kodak Co. was a pioneer in home photography. Its Brownie camera was the first commercially successful camera for amateur photographers and its Kodachrome film is legendary among photography buffs for its rich color and sharp clarity. But times have changed and Kodak is now reportedly teetering on the edge of Chapter 11 bankruptcy.

However, on Tuesday Kodak surprised business analysts by making a major announcement, and that announcement wasn't that it planned to file for bankruptcy. Instead, it unveiled plans for a large-scale reorganization and several staffing changes that is claims will help it move forward in a changes business landscape.

The lesson here that Chicago business owners should take away is that while bankruptcy is not something to fear, it is a serious step and sometimes it is worth looking into alternatives. A lawyer who regularly works with business owners who need help getting back on track may be able to explain this in more detail.

Returning to Kodak, the company is going to divide itself into two business units. One will focus on consumer goods, like personal printers and cameras. A second will concentrate on commercial needs, like high-tech printers and digital imaging equipment. Its film unit, once a hallmark that is now no longer economically viable, is being carved up between the two unites.

The company said the changes are being made so that Kodak can "capitalize on its tremendous technological capabilities." Some analysts are not convinced that this reorganization will save the company from bankruptcy, though. It will be interesting to follow this story and see what develops.

Source: The Rochester Democrat-Chronicle, "Kodak slims down, restricting three business segments into two; stock rises," Tom Tobin, Jan. 10. 2012

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