By Nick Brown

NEW YORK (Reuters) - Eastman Kodak Co's <EKDKQ.PK> proposed $525 million sale of its digital imaging patents to Intellectual Ventures and RPX Corp <RPXC.O> got approval from a bankruptcy judge on Friday, bringing the photography company a step closer to exiting Chapter 11.

The price is a fraction of the more than $2 billion Kodak had hoped to fetch for the patents when it filed for bankruptcy in January 2012. However, it allows the company to proceed with a plan to secure $830 million in financing and exit bankruptcy in the first half of this year.

Judge Alan Gropper gave his green light at a hearing in U.S. Bankruptcy Court in Manhattan. "We're disappointed in the price, but we're moving the case forward," Gropper said.

Intellectual Ventures and RPX lead a consortium of some of the world's biggest technology companies, including Adobe Systems Inc <ADBE.O>, Amazon.com Inc <AMZN.O>, Apple Inc <AAPL.O> and Fujifilm Holdings Corp <4901.T>.

The deal, announced in December, allows for the licensing of patents, settlement of patent-related legal claims, and the assumption of a cross-licensing agreement between Kodak and Fuji.

Kodak's patents hit the market as intellectual property values soared and technology companies began plowing money into patent-related litigation.

For example, Nortel Networks Corp <NRTLQ.PK> in 2011 sold 6,000 wireless patents in a bankruptcy auction for $4.5 billion, and Google Inc <GOOG.O> spent $12.5 billion last year for patent-rich Motorola Mobility.

But Kodak's patent auction dragged on beyond the initial expectation that it would be wrapped up in August and never generated nearly as high a price.

Kodak, which traces its roots to the 19th century, invented the handheld camera but was unable to shift successfully to digital imaging. It will probably be a different company when it exits bankruptcy, leaving the consumer business and focusing instead on providing products and services to the commercial imaging market.

The Kodak bankruptcy case is In Re: Eastman Kodak Co. et al, U.S. Bankruptcy Court, Southern District of New York, No. 12-10202.

(Reporting by Nick Brown; Editing by Lisa Von Ahn)