Kodak to raise $700M; KKR to invest

Photography company Eastman Kodak Co. is aiming to remain relevant in the digital age as it plans to raise up to $700 million, including a commitment from Kohlberg Kravis Roberts & Co, to bolster its balance sheet and free up capital for investments, the company said last week.

KKR, which plans to buy up to $400 million of Kodak’s senior secured notes due 2017, said that its investment reflected its belief in Kodak’s strategy. Kodak also said it plans to issue warrants to KKR to purchase up to 53 million shares of Kodak common stock.

Separately, Kodak is launching a private placement of $300 million of convertible senior notes, due 2017.

Depending on the amount of capital raised and the number of warrants that are converted, KKR could end up owning somewhere between 13% and 17% of the company, says a source close to the deal.

Kodak’s business has undergone a dramatic change as electronic, digital cameras have to a large extent replaced manual cameras. The company has spent the last six years shifting its focus from cameras and traditional film to digital printing systems and long-life photographic ink. —Laura Isensee and Megan Davies, Reuters