Confirmed as complete today (9 April) following an initial announcement in November when it hoped to sell the business for up to $390m, the sale will see proceeds of circa $320m go to Kodak once agreed indebtedness, other items and delayed proceeds are factored against the gross purchase price.
The Flexographic Packaging Division was put up for sale by Kodak in August, with Montagu named as the buyer shortly after. Montagu specialises in supporting incumbent chief executives and, in November, confirmed it would maintain the division’s organisational structure and management team, including a promotion to chief executive for president Chris Payne.
It will operate under Montagu as a standalone company called Miraclon and its offering, which comprises the development, manufacture and sale of flexo machinery and products, will include Kodak’s flagship Flexcel NX system.
“Closing this sale was a priority for Kodak, and I am proud we were able to execute on this plan and leverage a homegrown asset,” said Kodak executive chair Jim Continenza. “This is one of many steps we are taking to increase our financial stability and focus on generating cash for our shareholders.”
In its year-end results for 2018, Kodak last week posted a 4.4% decline in sales to $1.33bn, below expected revenues of $1.5bn-$1.6bn. A net loss of $16m contrasted with net earnings of $94m in 2017.
“Advance negotiations” are now underway to refinance Kodak’s remaining debt, according to chief financial officer David Bullwinkle.
Confirming the sale today, Kodak reiterated its commitment to focus on the growth areas of Sonora plates, enterprise inkjet, workflow software and brand licensing, aiming to maximise value in commercial printing, film and advanced materials.