Kodak Bonds Fall On Report of Possible Bankruptcy
By Michael Aneiro
Prices of bonds backing Eastman Kodak Co. (EK) are down Wednesday after a report that the iconic photo company is preparing for a possible bankruptcy filing. Kodak’s 7.25% notes due Nov. 15, 2013 fell 3.25 points in moderate trade to 30 cents on the dollar, according to online bond trading platform MarketAxess. Other Kodak issues were unchanged amid minimal trade volume.
Meanwhile, Dow Jones Newswires reports that the cost to insure Kodak debt against default jumped, as five-year credit default swaps on the company leapt 2.6 points and were last quoted at 70.5 points upfront, according to Markit data, equivalent to $7 million in upfront payments to cover $10 million of the bonds for five years, on top of $125,000 in quarterly coupon payments.
Kodak has $1.45 billion of debt and is trying to sell a portfolio of digital imaging patents that could provide much-needed cash as it tries to orient its business around printing.
blogs.barrons.com/incomeinvesting/2012/01/...?mod=yahoobarrons