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Judge approves Kodak’s post-bankruptcy plan

Not all are pleased

NEW YORK — Kodak doesn’t look a whole lot like it did when it filed for bankruptcy protection last year, but its executives and investors are hoping for a picture-perfect future.

Many products and services are gone, including the camera-making business that made it famous. Also gone are scores of workers, manufacturing facilities, supply contracts, and millions of dollars in investments.

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On Tuesday, Judge Allan Gropper approved the company’s plan to emerge from court oversight, paving the way for it to re-create itself as a much smaller company focused on commercial and packaging printing.

Kodak said it hopes to emerge from bankruptcy protection as early as Sept. 3.

Eastman Kodak Co. is credited with popularizing photography at the start of the 20th century and was known all over the world for its Brownie and Instamatic cameras. It was first brought down by Japanese competition and then an inability to keep pace with the shift from film to digital technology.

Since its bankruptcy filing, Kodak has sold many businesses and patents and shut down camera manufacturing.

Gropper noted that his approval of Kodak’s plan will result in the loss of retirement and health care benefits for many former workers, while many of the company’s investors will recoup just pennies on the dollar.

Chief executive Antonio Perez said that with the ruling, the company is poised to become a leader in the commercial imaging industry, providing services such as commercial printing and packaging.

Earlier this year, the company said it would sell its personalized and document-imaging businesses to its UK pension plan for $650 million as part of a deal that settles $2.8 billion in claims the retirement fund had made. It also sold its document imaging assets, digital imaging patents, and online photo service, and shut other divisions.

Last week, a majority of the company’s creditors voted to approve its plan to emerge. But some retirees, shareholders, and others objected.

Although some shareholders argued they are entitled to something in exchange for their stock, Gropper noted that he ruled previously that they are not. Creditors will receive 4 or 5 cents on the dollar and are entitled to be paid before shareholders are. Generally, holders of common stock do not receive anything for their shares when a company emerges from Chapter 11.

The US trustee also challenged the legality of hefty cash and stock bonuses executives are expected to get when the Rochester, N.Y., company exits from bankruptcy protection.

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