Kodak Pharma deal struck on informed questions about stock move

Attendees at an International Consumer Electronics Show talking to a company representative at the Eastman Kodak booth.

Daniel Acker | Bloomberg Getty Images

A deal that would have helped Eastman Kodak obtain funding to produce drug paraphernalia could have helped fight coronoviruses.

The US International Development Finance Corporation said in a tweet on Friday evening that it was negotiating the deal as regulators allegedly watch the trading activity that sent shares of Kodak on the news of the initial agreement.

“We will not proceed until these charges are approved,” the DFC said.

According to the Wall Street Journal’s Tuesday report, an investigation by the Securities and Exchange Commission focused on whether Kodak, once known for filming the camera, revealed the deal with the government. The Journal reported earlier this week that the investigation is still at an early stage and that allegations of wrongdoing may not be made.

According to the news, Kodak, which was trading at $ 2.62 a share on July 27, hit $ 60 within two days, on the day of the announcement. The stock closed at $ 14.88 on Friday after falling 7.6% during the session.

Kodak released the news to local reporters in Rochester, New York, where it is headquartered, on July 27, then asked several outlets who picked up the story to remove it, which they did. Questions have been raised by Sen. Elizabeth Warren, D-Massachusetts, and others about the possibility of insider trading associated with the announcement.

White House economic adviser Peter Navarro on Friday praised the DFC for the move, describing it as “very disappointed” about the allegations.

CNBC has reached out to Kodak for comment.


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