In the process, hundreds could lose their jobs in the USA as the firm seeks to save $65m in downsizing. The Flexcel NX system features flexographic equipment and products for printing on various packaging materials, including plastic, paper and cellophane. The division is an area of profitability for Kodak with a nine percent increase in revenue last year and is seen as a prime asset that could reach a premium price. Kodak hopes to then concentrate on environmentally-friendly printing plates, inkjet systems, workflow software and brand licensing.

Kodak CEO Jeff Clarke says: “This is a great opportunity to unlock value for shareholders given the strong interest we have received in the flexographic packaging division. The division has performed exceptionally well over the past five years and has become a significant player in the industry. This business is an excellent example of Kodak incubating and bringing disruptive innovation to the marketplace. Kodak has been evaluating monetization opportunities for the last several years in order to deleverage the company and we believe this is the right time to monetize this valuable asset.”

“Following this transaction, Kodak’s improved capital structure will allow us to increase our focus on demonstrated growth engines, while continuing to invest in and provide solutions across the commercial printing, film, and advanced materials industries.”

The American trade publication Labels and Labelling comments: “Kodak also announced it intends to take a $400 million, 18-month loan to refinance its existing term debt, which would allow Kodak to pursue the sale process in a way that maximizes value for shareholders, according to the release. Net proceeds from the FPD sale will first be used to repay this loan. A ‘Going Concern’ notice, filed as part of the company’s quarterly financial paperwork, suggested the company does not have sufficient financing to pay its debt (under the current terms) 13 months from now if the FPD sale falls through and the company can’t otherwise refinance. The company is ‘optimistic’ regarding the sale and the refinancing of its debt, but the plans are not solely in Kodak’s control and “therefore are not deemed probable” under accounting regulations, according to Kodak’s news release.”

Do you think there’s a question mark over Kodak or are they set for a great future? Email your views to Harry - Harry@linkpublishing.co.uk or call me on 0117 9805 040. Or react to the story on Twitter and have your say.