March 26, 2023

DealBook: Kodak Spinoffs Clear the Path for Emergence From Bankruptcy

Antonio Perez, Kodak chief, said its imaging units would be spun off to a pension plan.Yuri Gripas/ReutersAntonio Perez, Kodak chief, said its imaging units would be spun off to a pension plan.

Kodak said on Monday that it would spin off its document and personal imaging units to its British pension plan for $650 million in cash and noncash considerations, a move that paves the way for Kodak’s exit from bankruptcy protection.

Kodak had been seeking to sell off the two imaging operations. Two weeks ago, Eastman Kodak announced a plan to sell its document imaging business to Brother of Japan for $210 million, with the provision that it could revisit the deal if it could sell both units together.

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Now the bankrupt film pioneer has struck an even more advantageous deal after a protracted sales process.

More important, the pension plan will settle its bankruptcy claim of $2.8 billion, paving the way for the company to emerge from Chapter 11 bankruptcy in the United States. On Tuesday, Kodak plans to file a draft plan to emerge from bankruptcy.

“In one comprehensive transaction, Kodak will realize its previously announced intention to divest its personalized imaging and document imaging businesses and settle its largest legacy liability,” Antonio M. Perez, Kodak’s chairman and chief executive, said in a statement.

The company had filed for bankruptcy protection in January 2012 and has been selling off various assets since then. In December, Kodak reached an agreement to sell 1,100 digital imaging patents to a consortium of technology companies for $525 million, far less than expected. But as part of that sale, Kodak retained a license to use the digital imaging portfolio patents in its future businesses, and for those businesses that it is selling.

Kodak is being advised by Lazard and the law firm Sullivan Cromwell.

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DealBook: JPMorgan’s Staley to Join BlueMountain Capital

James E. Staley had been JPMorgan's head of investment banking until this summer.Yuri Gripas/ReutersJames E. Staley had been JPMorgan’s head of investment banking until this summer.

James E. Staley, a longtime JPMorgan Chase executive who served as the firm’s head of investment banking until this summer, is leaving the bank to join BlueMountain Capital Management as a managing partner, the hedge fund said on Tuesday.

The firm he is joining, a nine-year-old hedge fund with $12 billion in assets, profited from betting against JPMorgan by taking the other side of a bet on corporate debt that eventually cost the bank billions of dollars in May. The hedge fund then helped the Wall Street firm clear out its positions through another series of trades.

Mr. Staley’s departure from JPMorgan ends a 34-year career at the bank, which stretched back to the original J.P. Morgan Company. He worked in a wide variety of roles, from the Brazilian office to the head of the equity capital markets and syndicate divisions to the head of wealth management.

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Mr. Staley, an avid sailor known to most as Jes, became the chief executive of investment banking in fall 2009, presiding over the division’s expansion in the wake of the financial crisis.

But several months after the disclosure of the trading loss, JPMorgan shook up its management team. It gave Mr. Staley the new title of head of corporate and investment banking. To some inside the bank, the move effectively sidelined him in a position that was more symbolic than substantive.

At BlueMountain, Mr. Staley will be the firm’s ninth managing partner and will join the management, risk and investment committees. He will also buy an undisclosed stake in the firm.

“I’m very excited to be joining BlueMountain at a time when sea changes in the financial industry, combined with the firm’s unique strengths, open up enormous possibilities to deliver value to clients,” Mr. Staley said in a statement. “I want to thank all my colleagues at JPMorgan, my home for the last 34 years, and I look forward to working with them in the future.”

JPMorgan Chase’s chief, Jamie Dimon, sent a memo to employees on Tuesday morning:

To: All Senior Managers
From: Jamie Dimon
Subject: Jes Staley

This morning it was announced that our colleague, Jes Staley, will be leaving JPMorgan Chase to join BlueMountain Capital Management as a Managing Partner and Member of its Management Committee. Attached is BlueMountain’s press release.

Jes has been an extraordinary leader and a valued partner for many of us at JPMorgan over the years. He joined our company more than 34 years ago, and during this time he served in many critical management roles, including head of our Investment Bank, Asset Management group, Private Bank, and as one of the founders of our equities business. He has served our firm with distinction as a member of our firmwide Operating Committee, and he has been a trusted mentor to many people at our company.

While Jes is leaving JPMorgan Chase, he is joining a respected private investment firm, BlueMountain Capital. BlueMountain is an important client of ours, and we look forward to working with Jes in the future. Please join me in thanking Jes for his decades of dedicated service to JPMorgan, and in wishing him and his family all the best in the future.


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DealBook: A.I.G. Plans to Raise $2 Billion for Share Buyback

The headquarters of A.I.A. Group, American International Group's Asian insurance unit, in Hong Kong.Jerome Favre/Bloomberg NewsThe headquarters of A.I.A. Group, American International Group’s Asian insurance unit, in Hong Kong.

The insurance giant American International Group said on Thursday that it planned to sell a $2 billion stake in its Asian insurance unit as part of a plan to repurchase $5 billion worth of its own stock from the United States government.

The move is the latest effort by A.I.G. to shed assets and repay the government after the firm received a $182 billion bailout in 2008.

A.I.G. has been progressively selling its stake in its Asian insurance business, the A.I.A. Group, since listing the company on the Hong Kong stock exchange in an initial public offering that raised $17.8 billion.

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Under the terms of the deal announced, A.I.G. will offer investors 600 million shares in A.I.A. at 25.75 Hong Kong dollars to 26.75 Hong Kong dollars, according to the term sheet obtained by DealBook.

On the low end, the price represents a 2.1 percent discount to A.I.A.’s closing price in Hong Kong on Thursday; on the high end, it represents a 1.7 percent premium. The deal will leave A.I.G. with a stake of about 13 percent stake in A.I.A.

Robert H. Benmosche, chief of the American International Group, at a House panel in 2010 on the government's $182 billion bailout.Yuri Gripas/ReutersRobert H. Benmosche, chief of the American International Group, at a House panel in 2010 on the government’s $182 billion bailout.

Earlier this year, A.I.G. sold a $6 billion stake in A.I.A., which is the region’s third-largest insurer.

A.I.G. said on Thursday that it planned to buy as much as $5 billion of its own stock, the third repurchase of its shares this year. A.I.G. added that it would use the proceeds of the A.I.A. share sale, in part, to repurchase its shares.

The Treasury Department has been selling off its stake in A.I.G. Last month, officials said they would sell about $5 billion worth of A.I.G. stock to reduce the government’s holding to around 53 percent, from 92 percent when the firm was first bailed out.

The government’s links with A.I.G. now lie primarily with the Treasury Department’s shares in the insurer. The holdings could prove profitable. The stock is currently trading at almost $35, ahead of the government’s break-even price of $29.

Since receiving a government bailout, A.I.G. has recovered by reinventing itself as a smaller company that largely shies away from the types of complex investments that nearly led to its downfall.

Goldman Sachs and Deutsche Bank are managing the $2 billion share sale for A.I.G.

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