The UK Kodak Pension Plan (KPP) has completed its acquisition of Eastman Kodak Company's (EKC) Kodak Personalized Imaging and Document Imaging businesses and created a new company.

The Pensions Regulator (TPR), which provided clearance in April for the acquisition of the two companies and establishment of a new pension plan, welcomed the move and said it was an "important step" for all the parties involved.

The new company, Kodak Alaris, will focus on strategic, ongoing investments to ensure long-term growth and success, and its ongoing income will fund members' benefits.

The acquisition was part of a deal save EKC from insolvency and to fund KPP's deficit.

"Our excitement around the acquisition of these businesses comes not just from their market strength but from what we see as long-term, highly successful growth opportunities," said KPP independent chairman Steven Ross.

He said the acquisition starts a "new chapter" for the brand and that he is "thrilled" with the potential the new company holds for the scheme's members, its customers and its employees.

KPP has approximately 15,000 members and assets in excess of £1bn. Kodak Alaris will have more than 4,700 employees in around 30 countries and have an expected revenue of more than $1.3bn.

TPR's interim chief executive Stephen Soper said that scheme members will benefit from the cash flows and growth potential as a result of this solution.

He said that other issues still need to be resolved between the pension trustees and the Pension Protection Fund (PPF), including monitoring and governance arrangements to provide safeguards.

TPR will publish a report on how it approached the Kodak case once the remaining milestones have been completed.

Soper added: "Where businesses are in a distressed state, we're prepared to be creative and work collaboratively with pension trustees and employers to explore the options in order to find viable outcomes.

"These situations are often complex and we encourage trustees and employers to approach us at an early stage if they are experiencing financial difficulties that threaten ongoing support to the scheme."

EKC, the guarantor of Kodak Limited's obligations to KPP, filed for Chapter 11 bankruptcy in January 2012 in the U.S. The trustees of KPP then filed for unsecured claims for $2.837bn against EKC last year.

Earlier this year, EKC and KPP agreed to a settlement, which was approved by the US bankruptcy court. It included the acquisition of the Personalized Imaging and Document Imaging businesses by the KPP.

Hogan Lovells advised the trustees of the KPP and Katie Banks, a partner at the firm, said: "The completion of these business acquisitions is a major step in recovering value for the KPP and the EKC bankruptcy process, and is an extremely positive step forward for KPP members."

The acquisition was completed on 3 September, which is the same day that EKC emerged from bankruptcy.

First published 05.09.2013

monique_simpson@wilmington.co.uk