
Kodak surges 1,900% in 2 days after securing a $765M loan to make drugs - paulpauper
https://markets.businessinsider.com/news/stocks/kodak-stock-price-surges-765-million-government-drug-loan-2020-7-1029444079
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mmmBacon
This decision to give a tax payer funded loan to a company that’s basically
been unable to adapt to changing market conditions for 30 years really puzzles
me.

Why does Kodak think they can pivot into an entirely new industry? Wouldn’t
the money be better spent on a true startup in this area? Investing in several
startups would provide some risk mitigation that at least one of the companies
could make it in the market. A new company wouldn’t be saddled with all of
Kodak’s over bloated management and legacy. It’s also likely that such a
company or companies would create more than 300 jobs.

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cosmie
> Why does Kodak think they can pivot into an entirely new industry?

It's not an entirely new industry for them. Kodak's roots in the photography
industry built up a good bit of institutional knowledge and capital
infrastructure around chemical synthesis, and they've already been leveraging
that expertise/infrastructure for hire (including for pharmaceuticals) through
their Advanced Materials division[1].

So it's not entirely new to them, nor a complete unknown on their ability to
execute. This contract just elevates it into a substantially larger and more
important chunk of business for them.

Between the existing expertise and facilities, Kodak makes a much safer and
faster-to-market bet than seeding a bunch of startups from scratch.

[https://www.kodak.com/en/advanced-
materials/page/specialty-c...](https://www.kodak.com/en/advanced-
materials/page/specialty-chemicals)

~~~
Jasper_
They sold off most of their chemical company to Eastman Chemical about 25
years ago.

[https://en.wikipedia.org/wiki/Eastman_Chemical_Company](https://en.wikipedia.org/wiki/Eastman_Chemical_Company)

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ve55
Definitely a pretty surprising announcement for most, who haven't heard of
Kodak in years, aside from perhaps their bankruptcy and delisting earlier this
decade.

Interestingly enough there was apparently quite a bit of information leaked on
this yesterday, which is why the stock spiked yesterday as well, prior to
today's announcement. (e.g.
[https://old.reddit.com/r/pennystocks/comments/hyxxce/kodak_k...](https://old.reddit.com/r/pennystocks/comments/hyxxce/kodak_kodk_supposedly_making_a_big_announcement/)
or
[https://mobile.twitter.com/Eric05205725/status/1287866490000...](https://mobile.twitter.com/Eric05205725/status/1287866490000089088?p=p))

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erentz
Volume was up something like 30x the day before the announcement. Clear
insider trading on a massive scale occurred.

~~~
icedchai
Supposedly there was a leak by a news person. I cannot find the original
tweet, but there is this reddit thread from 2 days ago:
[https://old.reddit.com/r/pennystocks/comments/hyxxce/kodak_k...](https://old.reddit.com/r/pennystocks/comments/hyxxce/kodak_kodk_supposedly_making_a_big_announcement/)

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paulpauper
The stock price has gone up so much they could literally do a secondary offer
to pay back the loan and come out ahead. Crazy.

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mthoms
I'll never understand how the SEC can ensure there was no insider trading in
situations like this.

~~~
xenospn
I don't think they can. Even if they could, whoever made THAT much money can
litigate with them for decades and suffer no real repercussions.

~~~
staticman2
A judge would not allow them to litigate for decades. This is a silly idea.

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r00tanon
Undoubtedly a deal meant for Trump friends and family to take in millions of
insider trading profits.

