After being placed on hold so that the 130-year-old photography pioneer could file for Chapter 11 bankruptcy protection earlier this year, the auction for more than 1,000 of Kodak's digital imaging patents is ramping up again, according to three sources close to the matter. Investment banks Lazard Ltd
“We anticipate a robust and lively auction process which will assist us in achieving our objective of monetizing our non-core IP assets,” a Kodak representative said.
Kodak, the iconic company that invented the hand-held camera, filed for Chapter 11 bankruptcy protection on January 19.
The company, which holds 10,000 patents, will focus a significant part of its restructuring on finding a buyer for the 1,155 U.S. patents within its Digital Capture and Kodak imaging Systems & Services portfolios. The portfolios also include more than 500 foreign patents.
Kodak, based in Rochester, New York, is expected to retain the patents associated with its core printing business, two sources said.
Patents for sale
A number of global competitors are likely to emerge as interested parties – some of which are embroiled in patent litigation with Kodak – with Intel Corp
Kodak obtained its 18-month DIP loan from Citigroup Inc
“Consistent with the terms of our DIP agreement, we expect to file bidding procedures by June 30, 2012,” the Kodak representative said.
Kodak has yet to send out a “teaser” document containing basic financial information to prospective suitors, two sources said. The auction process is expected to follow a bankruptcy court-administered sale known as a 363 deal, which involves a “stalking horse” bid in which a buyer agrees to make a bid for most of the assets, setting the floor price for the process, two sources said.
In the Nortel auction, it had received court approvals for a “stalking horse” bid made by a unit of Google Inc
Earlier this month, Kodak agreed to sell its online photo services business to Shutterfly Inc
A U.S. bankruptcy judge told Apple last week that it cannot pursue patent infringement claims against Kodak now that the latter is in bankruptcy. The infringement claims center on a Kodak patent that lets consumers preview digital photographs on LCD screens. Kodak had accused Apple of trying to slow the patent sale process.