Once upon a time, Eastman Kodak‘s (PINK:EKDKQ) camera film business made it one of the most profitable companies in the world. This week, the bankrupt former camera giant sold that business in exchange for forgiveness of its pension debts.
Investors liked the move, sending Kodak shares surging more than 15% in over-the-counter trading on Tuesday morning.
The U.K. Pension Plan will receive Koday’s document and personalized imaging businesses. The deal eliminates the $2.8 billion the company owes to the retirees, but Kodak will also be paid about $650 million, the Wall Street Journal noted.
Ridding the company of the pension debt was a critical step for Kodak to realize plans to emerge from bankruptcy protection. The company, which has also negotiated the sale of other document imaging assets to Brother Industries, is expected to file a reorganization plan with the court this week.
Once Kodak leaves bankruptcy, the stripped down company will focus on selling commercial printing and packaging equipment.
Kodak recently posted quarterly earnings of $283 million. During the same time last year, it reported a loss of $366 million.
Earlier this year, Kodak sold 1,100 patents to a number of technology companies, including Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG).