Film fanatics freak out as Kodak Alaris is sold to venture capitalists!
Is Kodak film now an endangered species? As they say, it’s complicated.
By Jason Schneider
On August 1, 2024, Kodak Alaris, the worldwide distributor of Kodak film, announced that it had been acquired by Kingswood Capital Management, an L. A.-based private equity firm, following “strong growth and performance by Kodak Alaris.” The press release caused an instant panic among film shooters who assumed that Kingswood Capital were typical “vulture capitalists” who would break up Alaris, and sell its component parts to the highest bidder, putting continued production of Kodak film in jeopardy. And with Kodak film out of the picture, Fuji, Ilford, Agfa, et al might also be motivated to cut back on film production or stop making it entirely. The good news: worldwide film sales have increased about 20% over the last 5 years, despite prices increasing by roughly the same amount, so film is unlikely to disappear anytime soon. The bad news: even at its current levels, film is a niche product and manufacturing it is perhaps the most capital intensive and complex processes of any consumer product on the planet. Ergo, if film sales begin to decline or sufficient profitability cannot be maintained, film as we know it could slowly disappear and film fanatics could be reduced to coating their own glass plates, just as they did 150 years ago!
Kodak alaris logo, late version.
Kodak Alaris logo, generic version.
Here's the original text of the announcement by Kodak:
ROCHESTER, N.Y. Kodak Alaris announced today that Kingswood Capital Management, LP ("Kingswood") has acquired the company from the United Kingdom Pension Protection Fund (“PPF”). Kingswood is a Los Angeles-based private equity firm focused on buyouts of middle-market businesses and has significant experience in driving value for consumer and industrial services businesses.
Kodak Alaris continues the Kodak legacy of excellence in photography and imaging services through its two business units, Kodak Moments and Kodak Alaris Business Unit. Kodak Moments is a leading global provider of photo products and services to retailers, consumers, and entertainment properties. Kodak Alaris Business Unit is one of the largest global providers of data capture and processing solutions through its award-winning software, document scanners, and services. Kodak Alaris serves customers in more than 100 countries around the world with major locations in the US, UK, France, Germany, Mexico, and Australia.
In a joint statement, Nicki Zongrone, President of Kodak Moments and John Blake, President of Kodak Alaris Business Unit, said, “The investment by Kingswood Capital is a clear endorsement of the enduring value of our offerings and a testament to our team’s hard work. We are delighted to have secured the backing of new owners who share our vision for the future of our business. We look forward to starting this new chapter guided by Kingswood’s robust operational expertise.” Similarly, the PPF expressed its satisfaction in having reached an outcome beneficial for all parties, including the employees and stakeholders of Kodak Alaris.
“At Kingswood, our goal is to help companies reach their full potential by providing capital, bolstering its operations, and identifying avenues to achieve growth,” said Alex Wolf, Managing Partner of Kingswood. “We are excited to help continue Kodak Alaris’ strong recent performance and momentum.”
“We are thrilled to partner with the Kodak Moments and Kodak Alaris Business Unit management teams and global employee base,” said Andrew Kovach, Managing Director at Kingswood. “Both businesses have an outstanding reputation and heritage as leaders in their respective photography and imaging fields, and it is an honor to work with two companies held in such esteem.”
Kodak alaris, Stuttgart office.
Not surprisingly the Kodak press release and statements by Kingswood execs present a rosy picture of the future of Alaris but many remain deeply skeptical, if not cynical. Here are few examples posted on Reddit:
“The moment you hear a ‘private equity firm’ has acquired [insert company]” you should be rightly concerned. Their whole business model is gutting companies for parts, any sort of profit margin, all while sucking the life force out of them like a rabid vampire.”
“I don’t know why, but I don’t like how this sounds.”
“And you shouldn't. Private equity firms are concerned with one thing and one thing only: squeezing as much profit out of its investments, often to the detriment of consumers.”
“Nothing good is going to come from this.”
And here are some comments on the positive side posted on Reddit:
“If Alaris goes under or is intentionally bankrupted, it could just free up kodak to sell film directly beyond their motion picture and industrial products. Remember Alaris is the consumer sales arm of Kodak that they were essentially forced to sell to the UK Pension fund as part of a settlement. They are not the Kodak in Rochester that makes the film.”
“Probably a good sign, despite the negative perception of PE (private equity) in general. Kingswood specializes in operations investments - they invest when the business is good, but operations are poor. They invest in fixing operations, the company becomes more efficient, then they sell it to long term holders. They are different from the PE plunder model where PE buys a failing business to liquidate or gut it for parts.
Kingswood will only make money off the investment if they can turn Alaris into something with long term value. There isn't anything to liquidate - Alaris has no real estate, no factories, no patents of value, etc. What they do have is a perpetual right to sell Kodak still film and license the Kodak name for consumer goods. So, for Kingswood to make more money, they need to create a sustainable, efficient, and growing still film market. Price increases in the future? Probably. But they can't squeeze the prices too high, or the demand will shrink, and then no one will buy Alaris from Kingswood.” Editor’s note: Alaris’s rights to selling Kodak film are not “perpetual.” In 2023, they signed the current 5-year extension.
“Kodak Alaris was split out of the rest of Kodak during Kodak's bankruptcy. As part of the settlement, Kodak Alaris gained the right to all Kodak-branded consumer photographic films. However, Kodak Alaris does not make film, so they contract the "real" Kodak to make it, and then Kodak Alaris sell it. Just like Lomography, CineStill and Fujifilm also contracts with Kodak to make film for them to sell.
Should Kodak Alaris cease to exist, Eastman Kodak will likely be able to sell the photographic film themselves again, either under the Kodak name or another name.”
Kodak alaris Authorized Reseller logo.
Kodak Alaris: History, Facts, and Speculations
In 2012, Kodak filed for bankruptcy after a decade-long decline in the company's core film photography business. As part of the bankruptcy, Kodak faced a $2.8 billion claim by the UK Kodak Pension Plan (KPP). In resolving the claim, Kodak Alaris was formed when KPP paid $325 million for Kodak's personalized imaging and document imaging businesses, which includes the distribution of still film. KPP continued to control Kodak Alaris as a privately held company through Kodak Alaris Holdings Ltd. until August 1, 2024, when it was sold by the UK PPF to Kingswood capital management, a Los Angeles base private equity firm.
All Kodak film is made by Eastman Kodak in Rochester, NY at facilities located in Kodak Park (now officially named Kodak Business Park). There’s only one big film coating machine at that location, but it’s the most advanced coating machine in the world, the only one capable of turning out emulsions of up to 20 layers in a single “dry to dry” pass.
There are no official stats on Kodak’s still picture film production by type, but according to “good faith estimates by knowledgeable experts” it runs about 30% for black & white, 60% for color negative, and 10% color slide/transparency film, the latter all Ektachrome E100 Professional.
Like all capitalist enterprises, irrespective of ownership, Kodak Alaris is focused on maximizing profits, so Kingswood Capital Management is likely to pursue strategies that lower the cost of film manufacture while maintaining or moderately increasing wholesale and retail film prices without precipitously lowering demand. While nobody is privy to Kingswood’s motivations or policies, deep sixing film production or selling film distribution rights to bad actors seem highly unlikely.
In other words, hand-wringing paranoia is over the top. The bottom line: we sure hope Kodak decides to re-acquire the rights to distribute the film it manufactures. However if you’re a diehard film dinosaur like me, all you can really do is to ensure a plentiful film supply going forward is to shoot as much film as you can. And don’t complain too loudly about the price!
Is Kodak film now an endangered species? As they say, it’s complicated.
By Jason Schneider
On August 1, 2024, Kodak Alaris, the worldwide distributor of Kodak film, announced that it had been acquired by Kingswood Capital Management, an L. A.-based private equity firm, following “strong growth and performance by Kodak Alaris.” The press release caused an instant panic among film shooters who assumed that Kingswood Capital were typical “vulture capitalists” who would break up Alaris, and sell its component parts to the highest bidder, putting continued production of Kodak film in jeopardy. And with Kodak film out of the picture, Fuji, Ilford, Agfa, et al might also be motivated to cut back on film production or stop making it entirely. The good news: worldwide film sales have increased about 20% over the last 5 years, despite prices increasing by roughly the same amount, so film is unlikely to disappear anytime soon. The bad news: even at its current levels, film is a niche product and manufacturing it is perhaps the most capital intensive and complex processes of any consumer product on the planet. Ergo, if film sales begin to decline or sufficient profitability cannot be maintained, film as we know it could slowly disappear and film fanatics could be reduced to coating their own glass plates, just as they did 150 years ago!
Kodak alaris logo, late version.
Kodak Alaris logo, generic version.
Here's the original text of the announcement by Kodak:
ROCHESTER, N.Y. Kodak Alaris announced today that Kingswood Capital Management, LP ("Kingswood") has acquired the company from the United Kingdom Pension Protection Fund (“PPF”). Kingswood is a Los Angeles-based private equity firm focused on buyouts of middle-market businesses and has significant experience in driving value for consumer and industrial services businesses.
Kodak Alaris continues the Kodak legacy of excellence in photography and imaging services through its two business units, Kodak Moments and Kodak Alaris Business Unit. Kodak Moments is a leading global provider of photo products and services to retailers, consumers, and entertainment properties. Kodak Alaris Business Unit is one of the largest global providers of data capture and processing solutions through its award-winning software, document scanners, and services. Kodak Alaris serves customers in more than 100 countries around the world with major locations in the US, UK, France, Germany, Mexico, and Australia.
In a joint statement, Nicki Zongrone, President of Kodak Moments and John Blake, President of Kodak Alaris Business Unit, said, “The investment by Kingswood Capital is a clear endorsement of the enduring value of our offerings and a testament to our team’s hard work. We are delighted to have secured the backing of new owners who share our vision for the future of our business. We look forward to starting this new chapter guided by Kingswood’s robust operational expertise.” Similarly, the PPF expressed its satisfaction in having reached an outcome beneficial for all parties, including the employees and stakeholders of Kodak Alaris.
“At Kingswood, our goal is to help companies reach their full potential by providing capital, bolstering its operations, and identifying avenues to achieve growth,” said Alex Wolf, Managing Partner of Kingswood. “We are excited to help continue Kodak Alaris’ strong recent performance and momentum.”
“We are thrilled to partner with the Kodak Moments and Kodak Alaris Business Unit management teams and global employee base,” said Andrew Kovach, Managing Director at Kingswood. “Both businesses have an outstanding reputation and heritage as leaders in their respective photography and imaging fields, and it is an honor to work with two companies held in such esteem.”
Kodak alaris, Stuttgart office.
Not surprisingly the Kodak press release and statements by Kingswood execs present a rosy picture of the future of Alaris but many remain deeply skeptical, if not cynical. Here are few examples posted on Reddit:
“The moment you hear a ‘private equity firm’ has acquired [insert company]” you should be rightly concerned. Their whole business model is gutting companies for parts, any sort of profit margin, all while sucking the life force out of them like a rabid vampire.”
“I don’t know why, but I don’t like how this sounds.”
“And you shouldn't. Private equity firms are concerned with one thing and one thing only: squeezing as much profit out of its investments, often to the detriment of consumers.”
“Nothing good is going to come from this.”
And here are some comments on the positive side posted on Reddit:
“If Alaris goes under or is intentionally bankrupted, it could just free up kodak to sell film directly beyond their motion picture and industrial products. Remember Alaris is the consumer sales arm of Kodak that they were essentially forced to sell to the UK Pension fund as part of a settlement. They are not the Kodak in Rochester that makes the film.”
“Probably a good sign, despite the negative perception of PE (private equity) in general. Kingswood specializes in operations investments - they invest when the business is good, but operations are poor. They invest in fixing operations, the company becomes more efficient, then they sell it to long term holders. They are different from the PE plunder model where PE buys a failing business to liquidate or gut it for parts.
Kingswood will only make money off the investment if they can turn Alaris into something with long term value. There isn't anything to liquidate - Alaris has no real estate, no factories, no patents of value, etc. What they do have is a perpetual right to sell Kodak still film and license the Kodak name for consumer goods. So, for Kingswood to make more money, they need to create a sustainable, efficient, and growing still film market. Price increases in the future? Probably. But they can't squeeze the prices too high, or the demand will shrink, and then no one will buy Alaris from Kingswood.” Editor’s note: Alaris’s rights to selling Kodak film are not “perpetual.” In 2023, they signed the current 5-year extension.
“Kodak Alaris was split out of the rest of Kodak during Kodak's bankruptcy. As part of the settlement, Kodak Alaris gained the right to all Kodak-branded consumer photographic films. However, Kodak Alaris does not make film, so they contract the "real" Kodak to make it, and then Kodak Alaris sell it. Just like Lomography, CineStill and Fujifilm also contracts with Kodak to make film for them to sell.
Should Kodak Alaris cease to exist, Eastman Kodak will likely be able to sell the photographic film themselves again, either under the Kodak name or another name.”
Kodak alaris Authorized Reseller logo.
Kodak Alaris: History, Facts, and Speculations
In 2012, Kodak filed for bankruptcy after a decade-long decline in the company's core film photography business. As part of the bankruptcy, Kodak faced a $2.8 billion claim by the UK Kodak Pension Plan (KPP). In resolving the claim, Kodak Alaris was formed when KPP paid $325 million for Kodak's personalized imaging and document imaging businesses, which includes the distribution of still film. KPP continued to control Kodak Alaris as a privately held company through Kodak Alaris Holdings Ltd. until August 1, 2024, when it was sold by the UK PPF to Kingswood capital management, a Los Angeles base private equity firm.
All Kodak film is made by Eastman Kodak in Rochester, NY at facilities located in Kodak Park (now officially named Kodak Business Park). There’s only one big film coating machine at that location, but it’s the most advanced coating machine in the world, the only one capable of turning out emulsions of up to 20 layers in a single “dry to dry” pass.
There are no official stats on Kodak’s still picture film production by type, but according to “good faith estimates by knowledgeable experts” it runs about 30% for black & white, 60% for color negative, and 10% color slide/transparency film, the latter all Ektachrome E100 Professional.
Like all capitalist enterprises, irrespective of ownership, Kodak Alaris is focused on maximizing profits, so Kingswood Capital Management is likely to pursue strategies that lower the cost of film manufacture while maintaining or moderately increasing wholesale and retail film prices without precipitously lowering demand. While nobody is privy to Kingswood’s motivations or policies, deep sixing film production or selling film distribution rights to bad actors seem highly unlikely.
In other words, hand-wringing paranoia is over the top. The bottom line: we sure hope Kodak decides to re-acquire the rights to distribute the film it manufactures. However if you’re a diehard film dinosaur like me, all you can really do is to ensure a plentiful film supply going forward is to shoot as much film as you can. And don’t complain too loudly about the price!
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. Or get film manufacturers to do something about it. I dunno. 
