Eastman Kodak To Sell Gelatin Unit

NEW YORK -- Eastman Kodak Co. said Thursday it has agreed to sell its gelatin business as the struggling photography pioneer looks to boost its dwindling cash reserves.

Kodak is selling the Eastman Gelatine business to Rousselot, a division of the Vion Food Group. Terms were not disclosed. Eastman Gelatine produces gelatin used in photographic and printing processes as well as in food, pharmaceuticals.

Kodak expects the sale to close within the next 30 days. About 95 Eastman Gelatine employees will transfer to Rousselot, and Rousselot will also gain a 575,000-square-foot production facility in Peabody, Mass.

Kodak has been hurt in recent years by foreign competition and the widespread popularity of digital photography. With its cash reserves shrinking, Kodak warned last month it could run out of cash in a year if it doesn't raise new financing or sell assets. The company has been trying to sell a group of 1,100 digital imaging patents, and analysts believe Kodak could raise $2 billion to $3 billion through licensing deals.

Kodak is also suing Apple Inc. and Research in Motion Ltd., saying their smartphone camera features infringe on image-preview technology Kodak patented in 2001. The company is also focusing on sales of commercial and consumer inkjet printers, workflow software, and packaging.

Kodak's cash reserves shrank 10 percent to $862 million in the third quarter. In November, it set a year-end cash target of $1.3 billion to $1.4 billion that excludes any intellectual-property licensing deals, down from a previous forecast of $1.6 billion to $1.7 billion.

The Rochester, N.Y., company also announced that Laura Quatela will become co-president on Jan. 1. She will work with Philip Faraci, who has been president since September 2007. Quatela, 54, is currently Kodak's general counsel. She will be replaced by Patrick Sheller, the company's deputy general counsel, corporate secretary, and chief compliance officer.

In after-hours trading, Kodak shares jumped 7 cents, or 11.8 percent, to 70 cents. The stock is down 88.3 percent in 2011.

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Comments

[jfloars]

04:26 PM on 01/04/2012

As a longtime photographer (formerly professional, now shooting for my own entertainment), I mourn Big Yellow's travails. When I was a news photographer, I wouldn't dare walk out of the office without a bagful of Tri-X, and Vericolor II was always my go-to film for weddings and portraits. Although I've gone digital, I still like to haul out my F2, M2, or Rollei TLR and run a roll of film through it for old times' sake. I fear the day is near when I'll no longer have film to load into my treasured old friends.

[Fred Bronson]

04:35 PM on 12/23/2011

We need to back our American companies, what is going to happen when all of our companies are gone, and we are totally dependent on china, and other countries for all of our goods.?? Look at why the south lost the war, they had cotton, peanuts, and tobacco, the north had steel mills, industry that made hardware, that is why the north won. When the USA has nothing and is dependent the door is open to be taken over.
Frederick Bronson NC

[mjc]

03:06 PM on 12/23/2011

Eastman Kodak has always been considered such a great company that it is difficult to hear that they have money problems of any sort, even with digital cameras now more universal than the brownie. Kodak stock was considered THE very best, gold-plated, solid, forever wonderful in my youth and Rochester and the University of Rochester benefited greatly with that industry in town. But it is true that as the years have changed the original company and its creators there has been a tendency to be more cautious and careful in following the changing image market.

[MIKEinNYC]

08:29 AM on 12/23/2011

The fact is Kodak makes some nice digital non-slr cameras and their photo-printing services are among the best out there. Plus they make the film stock that most of our movies are shot on.

The big difference between digital-now and film-past is that with film you had to buy the film and you had to have the entire roll processed and printed to get to the meaningful ones. Kodak made money on that. Now you buy no film, you process no film, and you print only the few pictures that are meaningful. Clearly Kodak's business is scaled down, which is not to say that they can't make money or stay in business. Buy a Kodak digital camera. They're fine and reasonable priced.

[jobscabin]

08:17 AM on 12/23/2011

When Kodak was removed from the list of Dow Industrial leaders its demise was sealed. The long slow slog into extinction is well under way. Good company while it lasted but it has gone the way of the Underwood typewriter.

[mrcontinental]

04:52 AM on 12/23/2011

I'm pulling for you Kodak. We made many beautiful images together over the years but digital is so much faster and cleaner.

[Tunghoy]

01:03 AM on 12/23/2011

Railroads ruled when they carried all passengers and freight. But the railroads didn't invest in autos, trucks and airlines, because they thought of themselves only as railroads, not as transportation companies.

Not learning that lesson, Kodak made only a half-hearted effort at being an imaging or photography company, leaving others to innovate. Instead, they told everyone how much better film was.

Already, Ektachrome is no longer made for the amateur market, and it won't surprise me if the rest of the product line gets sold to a Chinese company.

[frank day]

07:26 PM on 12/22/2011

Kodak lost untold billions to IP theft.

[Kritikos]

07:23 PM on 12/22/2011

Old camera companies never die,......... they just fade to digital.

[spinotter11]

06:34 PM on 12/22/2011

First Polaroid, and now Kodak.

[rdk70816]

06:32 PM on 12/22/2011

Kodak is a grand old company the demise of which should be a lesson for all. Kodak did not rapidly enough adjust to the digital world. Kodak was always a slow moving company entrenched in its own expertise with no vision to look further. It passed up chances to develop the Polaroid technology and did not. It had a chance to develop the Xerox technology and did not. Rest in peace.

[dbw53022]

08:47 PM on 12/22/2011

Didn't Kodak lose a patent infringement lawsuit to Polaroid? I thought they went down that path.. But they sure missed digital.. Sometimes you're so close to your products you never detect the sea change.

[rdk70816]

10:18 AM on 12/23/2011

I think they were given the opportunity to purchase the Polaroid technology before there was a Polaroid. My memory is vague on that and I don't want to investigate the history. The history is too sad. But they had their run and provided prosperity for many people.