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What a terrible start to the year. The venerable Eastman Kodak Company is getting ready to file for Chapter 11 bankruptcy protection at the end of this month or early February. Chapter 11 is a US vehicle for protecting a company from its creditors, giving it a breathing space in which to sort out the business. Kodak is also at risk of delisting from the New York Stock Exchange (NYSE), which happens if a company's shares fall below $1. Kodak's dropped 28 percent to $0.47 (30p) following the report about the Chapter 11 possibility and the NYSE has given Kodak six months in which to rectify matters. 

These grave events might not seem important to the sign and display sector where Kodak has a very limited presence. Kodak has materials for wide-format printers and still supports the Novajet printer line. Brand Management Group, a Kodak partner, now supplies Kodak wide-format ink-jet media including vinyl and banner materials.

This news is a terrible indicator of the fragility of the graphic arts supplier community and this is of considerable importance to wide-format printers. The printing industry as a whole has undergone momentous changes in the last few years, producing some incredibly dynamic sectors, such as sign and display production. However the amazing breadth of technological resource that has enabled developers to design and manufacture the broad range of production systems available has a price. The price is particularly high if developers and suppliers fail to capitalise on their research and development efforts.

What happens next for the company depends on two things: the fourth quarter results due to be announced on January 26th, and how successful Kodak is at finding someone to lend it $1bn (£648m) of debtor-in-possession financing. According to company sources and as reported in The Wall Street Journal, this is what Kodak is expected to need to keep it going through bankruptcy proceedings.

It's all a matter of timing. For the last few years Kodak has been selling off its considerable intellectual property asset portfolios, which has helped it to transition the business to develop new lines of business, including commercial printing. In November Kodak's chairman and chief executive Antonio Perez, the ex-HP honcho hired to turned Kodak's fortunes around, said that: "Our expected year-end cash position does not contemplate a new financing or the sale of our IP portfolio." The plan was to sell 'non-strategic assets of approximately $200m [£130m], and intellectual property licensing transactions between $250m [£162m] and $350m [£227m] … we expect to finish the year with $1.3bn [£843m] to $1.4bn [£908m] in cash.' It seems that this plan hasn't worked out so well. Let's hope the news improves on January 26th.