Eastman Kodak Co. shares surged 69% Monday morning after a federal agency cleared the company of wrongdoing related to a $765 million loan that aided its pivot into drug-ingredient manufacturing.
The inspector general for the U.S. International Development Finance Corp. (DFC) in a report issued to Democratic Sen. Elizabeth Warren of Massachusetts found no evidence that agency officials had a conflict of interest in granting the loan, according to The Wall Street Journal.
|KODK||EASTMAN KODAK CO.||7.21||+0.11||+1.55%|
The report did not say if the loan would move forward.
Neither representatives for Eastman Kodak nor the DFC immediately responded to FOX Business’ requests for comment.
Eastman Kodak was granted the loan in July as part of President Trump’s plan to bring the manufacturing of critical pharmaceutical ingredients back to the U.S. after the COVID-19 pandemic called attention to the country’s reliance on China.
CEO Jim Continenza told FOX Business’ Stuart Varney that the loan would allow the company to supply 25% of small-molecule key starter materials and active pharmaceutical ingredients for the U.S. supply chain.
The loan’s announcement caused Eastman Kodak shares to soar as much as 2,190% over the following two trading days, from $2.62 to $60. The stock, weeks later, pulled back to $5.53 as the loan was put on hold amid conflict of interest concerns from Democratic lawmakers.
The U.S. Securities and Exchange Commission investigated how news of the deal was announced. Company executives, including Continenza, were granted stock options in the month before the deal was announced. Evidence of wrongdoing has not been found.
CLICK HERE TO READ MORE STORIES ON FOX BUSINESS
Kodak shares were up 87% this year through Friday’s close of $7.53.
View more information: https://www.foxbusiness.com/markets/kodak-stock-soars-cleared-federal-loan-probe