Eastman Kodak Co has transferred its entire stake in Lucky Film Co Ltd, China's largest maker of photographic film, to end the two companies' four-year partnership.

Guangzhou Chengxin Venture and Investment Co took over the 20-percent stake, or 68.4 million shares, for US$37 million and then transferred a five-percent stake in Lucky to an investment company named Hongyu for 67 million yuan (US$9.3 million), Lucky said in a statement to Shanghai Stock Exchange yesterday.

Lucky's parent held a 43.16-percent stake after the transfer, the statement said.

The company's share price plunged 4.98 percent to 14.68 yuan yesterday while the Shanghai Composite Index lost 1.43 percent to 4,320.77.

Kodak invested US$100 million in Lucky in October 2003 believing that big potential existed in the film market in China.

However, with the popularity of digital photography, it became apparent people preferred to store pictures in computers or online.

Kodak in 2003 began a global plan to shift to a digital camera firm from a producer of traditional film products as the surging use of digital cameras caused a sharp decline in the global film developing business.

"Kodak has achieved key steps in its transformation to the digital area," said Tian Geng, a spokesman of Kodak China.

Lucky plans to convert 37.8 million non-tradable shares to tradable equities.

The plan still needs approval from the State-owned Assets Supervision and Administration Commission.

The Chinese government has aggressively encouraged the conversion of non-tradable shares in state-owned enterprises.

Lucky's net profit surged 165.66 percent to 9.9 million yuan in the third quarter of last year.