Kodak to retain Prosper inkjet business
Eastman Kodak has reversed the decision to sell off its Prosper inkjet business after failing to attract a suitable offer.
“While we had multiple offers, the range of consideration did not reflect the value of the business today,” says Kodak CEO Jeff Clarke. “This is a pragmatic decision given the improvements in the business and the offers received.”
The move has been welcomed by the local Kodak operation. “It’s very exciting and we are looking forward to working with current and future customers using Kodak Prosper technology,” says Anthony Harvey, ANZ Country Leader, Kodak – Print Systems Division.
Kodak announced its intention to sell-off the Prosper business in March 2016, with Clarke saying at the time: “Prosper will be best leveraged by a company with a larger sales and distribution footprint in digital printing markets.”
A year later, with Prosper posting a 40 per cent increase in annuity revenues, Clarke outlined a new strategy for its inkjet division.
“Prosper performed well in 2016 with a 40 percent increase in annuity sales for the full year. We expect our Enterprise Inkjet Systems Division (EISD) to be profitable this year, including our next-generation Ultrastream investment.
“Kodak will continue to invest in its Ultrastream program and has entered into letters of intent with partners which will create new applications that drive market demand for the technology. Kodak will begin delivering Ultrastream evaluation kits to 17 companies, including Fuji Kikai, Goss China, Matti, Mitsubishi Heavy Industries Printing & Packaging Machinery (MHI-PPM) and Uteco, to explore the integration of Ultrastream into their future printing solutions. Kodak expects products built on Ultrastream technology to go to market in 2019.
The company’s reversal on Prosper has been described as a ‘master stroke’ by industry observer Gareth Ward, publisher of Print Business (UK).
“The decision by Kodak to withdraw its Prosper inkjet business from sale is the right one and a master stroke for the reborn business, even if shareholder reaction suggests they are not as keen to welcome this prodigal son back into the fold,” says Ward. “It was pressure from the financial community that had funded Kodak’s re-emergence from Chapter 11 which forced the business to remove Prosper from the balance sheet and prepare it for sale just over a year ago, so the reception was not unexpected.
“Since last year Kodak has managed to restructure some of those lendings to reduce the debt burden. It has shown that the medicine is working in its other divisions and Prosper has posted a 40% increase in annuity revenues with every indication that there will be further growth to come. Profitability is on the horizon.”
Clarke says: “Kodak will continue to evaluate and act on opportunities to improve shareholder value through acquisitions, partnerships, and sales of businesses within its portfolio.”