Apple Inc. (NASDAQ:AAPL), Google Inc. (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT) and several other tech firms have been waiting a year, but finally, Friday was the day that it was official – these firms can now get their hands on more than 1,000 patents previously held by Eastman Kodak Company, which put the portfolio up for auction as part of the company’s Chapter 11 bankruptcy filing.
However, Bloomberg reports that the portfolio that was valued at at least $2 billion was sold for only $525 million – about a 75-percent discount – to a group of companies led by Apple Inc. (NASDAQ:AAPL) and Google Inc. (NASDAQ:GOOG). The patent auction was meant to give Kodak some cash so it could emerge from bankruptcy protection by the middle of 2013 and refocus its business model on commercial printing.
U.S. Bankruptcy Judge Allan Gropper said he was “disappointed” in the price but “we’re moving the case forward so we should be optimistic.” Kodak admitted that an estimated $2.6 billion value for the patents “was not achievable” in court papers, and company attorney Michael Torkin said this was likely the best price the company could have expected and that the sale achieves “patent peace” by serving as a settlement for litigation of several patent cases Kodak was involved in were based on this portfolio, which primarily involved the capture, manipulation and sharing of digital images.
Officially, the sale was made to licensing firm Intellectual Ventures, which licenses patents to many tech firms, including Apple Inc. (NASDAQ:AAPL) The companies which grouped together in this deal all focused on specific patents that each company have eyed for their future legal protection.
Give us your quick thoughts about this deal and how these companies will benefit from this new portfolio. Will this generate a new phase of innovation from several companies? What companies do you think will win most out of this deal? We’d like your thoughts.
As of 2:05 p.m. ET Friday, Apple Inc. (NASDAQ:AAPL) stock was trading at $521.30 a share, down slightly on the day.
DISCLOSURE: I hold no positions in any stock mentioned.
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