Apple, Google, and several other companies are buying Kodak's patent portfolio in a US$525 million deal. Kodak announced the purchase on Wednesday as part of its efforts to emerge from Chapter 11 bankruptcy.
Kodak sells off its intellectual property for $525 million
Kodak didn't mention Apple or Google by name, but did call out Intellectual Ventures and RPX Corporation, both of which are patent firms that represent other companies. Apple happens to be part of Intellectual Ventures, and Google is with RPX Corporation.
Kodak said in a statement,
Under the agreements, Kodak will receive approximately $525 million, a portion of which will be paid by 12 intellectual property licensees organized by Intellectual Ventures and RPX Corporation, with each licensee receiving rights with respect to the digital imaging patent portfolio and certain other Kodak patents. Another portion will be paid by Intellectual Ventures, which is acquiring the digital imaging patent portfolio subject to these new licenses, as well as previously existing licenses.
Other companies in the consortiums include Microsoft, Samsung, HTC, LG Electronics, Facebook, Amazon, and more.
For Apple, the patent portfolio could prove to be a valuable asset in the company's legal battles over mobile device design infringement claims since it doesn't cover parts of the mobile market that are considered core technology. The patents could also cut down on potential lawsuits since it's likely companies involved in the purchase have some type of sharing deal in place.
Kodak isn't saying how the $525 million is divided between Intellectual Venturs and RPX, and the companies aren't saying how much each of their clients paid as part of the deal.
"This proposed transaction enables Kodak to repay a substantial amount of our initial DIP loan, satisfy a key condition for our new financing facility, and position our Commercial Imaging business for further growth and success," said Kodak CEO Antonio Perez.
While the deal will get Kodak some much needed cash, it also takes away the company's intellectual property which is about all it has left. Kodak stopped making film, and at this point is little more than an inkjet printer company.
Losing its intellectual property, however, doesn't have Mr. Perez concerned. "Kodak remains a major center of invention and innovation," he said.
The deal is currently awaiting Bankruptcy Court approval.