'BILLIONS' BEING ADDED TO THE SHARE PRICES OF PHARMACEUTICAL
WHAT'S CAUSING THE SURGE?
30 July 2020
Trump signs deal for Kodak to enter into the Pharmaceutical division by authorising a $765m loan
Kodak shares have surged 1,481 percent this week in heavy trading as the Trump administration offered the former photography industry leader a financial lifeline to make ingredients in drugs used to fight coronavirus. The company’s valuation jumped from $92m to $1.5bn as it shares rose from $2.10 at Friday’s close to $33.20 on Wednesday. The stock was halted more than a dozen times within the first two hours of trading on Wednesday, a day after it more than tripled in value. The pace of trading far surpassed anything seen since the company returned to the New York Stock Exchange after its emergence from bankruptcy in 2013. Kodak, which is based in Rochester, New York, and the US International Development Finance Corporation, announced on Tuesday that the company had secured a $765m loan to produce drug ingredients under the Defense Production Act. Kodak shares began climbing on Monday. On that day, a Rochester television station published — and then deleted — a report saying an announcement was forthcoming from the company on Tuesday, news anchor Adam Chodak of CBS-affiliate WROC told the Financial Times. The WROC report did not include details on what the two organisations would reveal, beyond a manufacturing agreement related to Covid-19. By day’s end, Kodak shares had gained 25 percent as some 1.65m shares changed hands, more than 14 times the daily average over the preceding 10 trading days, according to data compiled by Bloomberg. © THE FINANCIAL TIMES LTD 2020