Kodak to buy Creo for about $980 million
Mon Jan 31, 2005 07:42 AM ET
(Adds details on value of deal, background)
NEW YORK, Jan 31 (Reuters) - Eastman Kodak (EK.N: Quote, Profile, Research) on Monday said it would buy printing technology firm Creo Inc. (CRE.TO: Quote, Profile, Research) for about $980 million in cash, to bolster its strategy to push more aggressively into the commercial printing business.
Kodak, which has been undertaking a challenging transition to digital products as it shifts focus from its flagging traditional film business, will pay $16.50 per share for Creo. Shares of Creo, whose board has approved the proposed deal, closed at $14.36 on Friday on Nasdaq.
Kodak said the deal will modestly dilute earnings for the rest of 2005, but said it was committed to a forecast of 2005 full-year earnings per share in the range of $2.60 to $2.90.
For 2006, Kodak said it expects that the acquisition of the Vancouver, British Colombia-based maker of prepress systems to add at least 5 cents per share to operational earnings, with about $700 million of incremental revenue.
Kodak, based in Rochester, New York, reiterated its target for earnings from operations of $3 a share in 2006.
Kodak had earmarked some $3 billion for acquisitions by 2006 when it launched its transformation toward growth markets such as commercial printing and digital photography in 2003.
Earlier this month, it announced plans to take full control of Kodak Polychrome Graphics, a maker of commercial graphics films and plates, by buying Sun Chemical Corp.'s 50 percent stake in the joint venture for about $817 million over several years.
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