The opening bids for Eastman Kodak’s digital patent collection have come in far below the $2.6 billion the company said they could be worth. The bankruptcy court ordered auction may not leave much cash for the photography pioneer after the creditors are paid off. The report comes from Dana Mattioli, Ashby Jones, and Mike Spector reporting for The Wall Street Journal.
“Kodak received two bids from investor groups pitting Silicon Valley giants Apple Inc. and Google Inc. against each other ahead of an auction set for Wednesday, people familiar with the process said,” Mattioli, Jones, and Spector report. “The bids from the two teams came in around $150 million to $250 million, the people said.”
The initial bids could rise quickly if Apple and Google decide to compete to keep the patents away from each other as the auction could turn out to be another battle ground between the two in the war over the profitable smartphone and tablet markets.
A year ago, in a bankruptcy auction for Nortel Networks Inc.’s patents, Google started the bidding at $900 million, before a consortium that included Apple and Microsoft won the patents with a high winning bid of $4.5 billion.
The low starting offers for the Kodak patents means the company will have to hope for aggressive bidding among the consortiums if it hopes to gain enough cash to pay its creditors off and still have any left over to reorganize the company as it hopes to emerge from Chapter 11 born anew as a printer company.