Bankruptcy judge Allan Gropper has signed off on a restructuring that will allow Eastman Kodak (EKDKQ.PK -27.8%) to emerge from Chap. 11 as a smaller company focused on commercial printing/imaging and touch sensor solutions.
Creditors with secured claims will be paid in full, while those with unsecured claims will only receive 4-5 cents on the dollar. Shareholders will receive nothing.
Thus, the ruling (widely expected) led Kodak to dive to $0.056 on the pink sheets just before the close.
Kodak, which has shed 47K employees since '03, will emerge from Chap. 11 with just 8.5K. Going into Chap. 11, and prior to major asset sales, headcount was 17K.
Last week, Gropper rejected a bid by shareholders to have a committee representing their interests set up for them.
Going forward, Kodak plans to sell $406M in stock (85% equity stake) through a rights offering backstopped by creditors.