Eastman Kodak Co. (EK), seeking to generate cash from its intellectual property, has signed confidentiality agreements with numerous potential buyers of patents it put up for sale last month, Chief Executive Officer Antonio Perez said.
“At the moment we announced that, the phone started to ring,” Perez, 65, said yesterday in a telephone interview. Lazard LLC, Kodak’s adviser, has “contacted a large number of people. There are a number of people who signed their NDAs,” he said, referring to non-disclosure agreements protecting details about inventions covered by the patents.
Kodak, headed for its sixth annual loss in the past seven years, is trying to generate cash for its inkjet printers and other digital businesses Perez is counting on to turn the company around. The U.S. International Trade Commission has delayed a ruling on Kodak’s attempts to win $1 billion in licensing fees from Apple Inc. (AAPL) and Research in Motion Ltd. (RIM) for image-preview technology used in cameras.
The patents may attract bids from Microsoft Corp., Apple Inc., Google Inc. (GOOG) and Samsung Electronics Co., said Christopher Marlett, founder and CEO of MDB Capital Group, a Santa Monica, California-based investment bank specializing in intellectual property.
The patents may help smartphone makers improve cameras on their devices while enhancing the ability of Web companies to identify images, Marlett said today by telephone.
Kristin Huguet, an Apple spokeswoman, declined to comment, as did Microsoft spokesman Kevin Kutz and Jim Prosser, a spokesman for Google. Chris Goodhart, a Samsung spokeswoman, did not immediately return a call seeking comment.
Perez, CEO since 2005, said he’s seeking patent deals that give Kodak cash up front as well as preserve licensing rights to its technology.
“All of this litigation takes a lot of time, and it’s very expensive and demands a lot of my time,” he said. “We would rather get an infusion of cash in advance, being able to have a series of relationships with many of those companies that otherwise we’d have to be in legal conflict with.”
Kodak advanced 36 cents, or 12 percent, to $3.40 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have tumbled 37 percent this year.
Research In Motion climbed $1.82, or 5.9 percent, to $32.55. The Waterloo, Ontario-based maker of the Blackberry holds 2,033 patents, according to the U.S. Patent Office, and may attract takeover interest from Samsung and Microsoft, according to Stewart Capital.
The 1,100-plus patents Kodak put up for sale July 20 may generate more than $3 billion, according to MDB’s Marlett.
“What we are selling is the part of the portfolio that does not apply to the core investments and the future of the company,” said Perez, who declined to disclose potential bidders and specifics of negotiations.
He said Rochester, New York-based Kodak is trying to tap a “very hot” market for intellectual property.
Google, the biggest maker of smartphone software, agreed to buy Motorola Mobility Holdings Inc. for $12.5 billion this month. Google had earlier bid for more than 6,000 Nortel Networks Corp. patents and applications, losing out to a $4.5 billion offer from a group including Apple, Research in Motion and Microsoft Corp. (MSFT)
“This is the right time,” Perez said. “The conversations are going. We are hoping quickly to get to a good conclusion.”
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