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Kodak shares plunge after DFC puts deal on hold

WHECTV
Updated: August 10, 2020 05:28 PM
Created: August 10, 2020 11:45 AM

ROCHESTER, N.Y. (WHEC) — Kodak shares plunged more than 40% Monday morning after news the company's deal with the federal government is on hold.

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News10NBC reported Saturday the U.S. International Development Finance Corporation is pausing a $765 million loan with Eastman Kodak to make prescription drug ingredients.

When the deal was announced about two weeks ago, Kodak’s stock skyrocketed.

However, NBC News reported a few investors, including the executive chairman, bought the stock last December, then sold or donated it right after the stock jumped.

Regulators are now investigating why Kodak's stock shot up before the announcement.

White House Press Secretary Kayleigh McEnany was asked about the president's use of the Defense Production Act (DRA) and the allegations of insider trading.

"This president has used the DPA effectively but we're certainly aware of the Kodak allegations and take them seriously," McEnany said.

When asked if the president would "pull the plug" on the deal, she said, "I'll leave that to the president, but he takes these very seriously, we won't speculate as to what that investigation finds."

Federal regulators, Democrats in Congress, and now Kodak itself, are all investigating the plan. Investment experts say the investigation could last months.


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