ROCHESTER, n.y. — The ripple effect from Eastman Kodak’s bankruptcy filing Thursday extends in many directions: Employees are bracing again for layoffs, retirees are fretting over health care coverage, and the photography pioneer’s biggest creditors and stakeholders — from movie studios and big-box retailers to the CEO — are preparing to take the hit financially.
Mayor Tom Richards portrayed the decision to seek Chapter 11 reorganization as more of a psychological blow than an economic one to Rochester, where Kodak had been the engine of commerce for most of the company’s 132 years. Its payroll in the medium-size city along Lake Ontario has slipped below 7,000 from a peak of 60,400 in 1983.
Kodak operates a plant in Windsor that makes thermal media, motion-picture film and color paper. The plant employs nearly 2,000 workers.
The company said it has secured $950 million in financing from Citigroup and expects to continue operating and pay its employees while in bankruptcy.
In the meantime, Kodak will try to execute its plan for recovery. Since 2005, it has poured hundreds of millions of dollars into new lines of inkjet printers that are finally on the verge of turning a profit.
Veteran employees said they are scared the crisis could sink careers that somehow dodged so many previous cutbacks. And Kodak’s 25,000 retirees in Rochester fear that already diminished health benefits could disappear altogether.
The company did not rule out the possibility of layoffs. It also resolved to “fairly resolve legacy liabilities,” which suggests that it may try to cut its retiree health care costs, estimated at $132 million in 2011.
