There are certain words in the American culture that instantly draw negative reactions. "Bankruptcy" is one of them. Most people probably associate bankruptcy with poverty, excess spending or an inability to manage finances. While it is certainly true that some cases of bankruptcy filings may involve certain aspects of the stereotypes people associate with this legal process, it is important to point out that there are many success stories tied to completed bankruptcy filings. The decision makers in one major company are probably hoping that they will eventually be among those "rags to riches" tales.
Some of our Escondido readers may remember seeing previous posts about the Chapter 11 bankruptcy process that former film and camera giant Eastman Kodak was going through. Each step of this company's bankruptcy proceedings was usually covered by national news outlets, mostly because of the company's former standing in the American business community and the rapid descent into financial trouble the company experienced as digital cameras and smartphones revolutionized the way people take pictures. But now, according to a recent article, it appears that there may be good news on the horizon for Kodak: the company was recently approved to emerge from bankruptcy.
Businesses that go through the Chapter 11 process usually have to make dramatic changes involving the company's structure, business model and staff in order to reform into a profitable entity. For Eastman Kodak, this was certainly the case. A business bankruptcy can also include selling off company assets to satisfy debts, which is also an approach Eastman Kodak took. The company will continue to exist, but in a much smaller format than where the business was in its heyday.
Source: NBC News, "A new Kodak moment: Emerging from bankruptcy," Sept. 3, 2013