Polaroid seeks bankruptcy protection
Polaroid Corporation, known to generations of consumers for its instant cameras and film but buried beneath a mountain of debt, filed for Chapter 11 bankruptcy protection in the US today.
The widely expected move comes three months after the Massachusetts based company said it would miss payments to bondholders and explore strategic options - including a sale of the company - as it negotiated with creditors.
No buyer stepped forward and business slowed further after the US terrorist attacks, forcing the company into reorganisation.
Polaroid, founded by Edwin Land in 1937, has struggled to adapt to new digital technology as its core instant film business has slumped.
The company could be sold off in its entirety or essentially stripped for parts under the supervision of a bankruptcy court.
A Chapter 11 reorganisation would make Polaroid and its parts more attractive to potential buyers, analysts said. Buyers could acquire equity for free and possibly get a discount on Polaroid debt if the purchase came out of bankruptcy proceedings.
Polaroid has been trying to restructure £650 million in debt, and lost £75 million in the quarter ending July 2.
It has laid off at least 2,950 employees - 35% of its work force - and been in negotiations with bondholders since missing interest payments in July.
But it still has valuable assets, including a well-known name and new printing technology, called Opal and Onyx, which is expected to debut next year.
Analysts have said they were impressed with the technology, though they doubted Polaroid could develop it quickly enough to save the company from bankruptcy.
