Kodak May Declare Bankruptcy

The stock market reacted strongly yesterday to a report that Kodak may be about to declare bankruptcy.

The ailing photography pioneer's shares fell to a new all-time low after the Wall Street Journal reported that Kodak is preparing for a bankruptcy filing "in the coming weeks" should it fail to sell a trove of 1,100 digital-imaging patents. Analysts have said the patents could fetch $2 billion to $3 billion, but no takers have emerged since Kodak started shopping them around in July. In November, the 131-year-old company said it could run out of cash in a year if it didn't sell the patents. Even as it looked to a future rooted in its emerging printer business, the company was reporting a third-quarter loss of $222 million — its ninth quarterly loss in three years — and it said its cash reserves had fallen 10 percent in three months. Now, Kodak finds itself in a state of suspended animation.

Kodak shares closed yesterday at 47 cents.