Eastman Kodak company gave its CEO 1.75 million stock options just a day before the company’s stock skyrocketed amid news it would receive a $ 765 million federal loan for the manufacture of critical drug components, the New York Times reported on Friday.
When news of the White House deal went online earlier this week, Kodak shares rose more than 1,000%, hitting around $ 60 (they were since fallen at around $ 21, which is still a huge jump from their average cost of $ 2-3). As a result of this unbelievably Fortuitous moment (wink), Kodak CEO Jim Continenza saw the value of his stock options climb to $ 50 million in less than 48 hours of receiving them, according to the point of view. sale.
Listen, it’s no secret that some of the bigger chats in industry have taken advantage of this pandemic to grow even more grotesquely obese. But can they at least try not to be so obvious about it when people are literally dying?
A Kodak spokeswoman declined to comment on this profitable coincidence and instead recalled the output that the value of Continenza’s stock options could very well change before it decides to cash them out against Kodak shares.
While Kodak may have been a titan in the film industry at one point, he has been wading for years in an attempt to reinvent itself following its exit from bankruptcy protection in 2013. Recently, the company has found a new foothold by turning to the pharmaceutical industry, leveraging its history of over one hundred years of know-how chemical to start making drug components that can then be refined and sold through pharmacies.
In May, the Trump administration began discussions with several companies, including Kodak, about funding the U.S. health care sector with federal loans both in response to the coronavirus outbreak and to reduce reliance on it. with regard to foreign markets in the event of future health crises, un Washington Post report. Trump authorized the move via a decree which invoked the Defense Production Act, which allows the federal government to make compulsory the way in which national companies produce and distribute essential goods.
“We’re really doing this to help tighten and fix America’s pharmaceutical supply chain,” Continenza told The Post after the federal loan was announced.
It should be noted that at around the same time the White House entered talks with Kodak, the company gave 240,000 additional stock options to members of its board of directors, a estimated value of $ 4 million, according to the Times. Gee, I guess the lightning strikes twice.
As the Times points out, Kodak isn’t the only company turning federal support into profit with questionable stock bets at the right time. Shortly after insiders at California-based biotechnology company Vaxart were granted stock options, the company announced that a federal agency would test its potential vaccine against the coronavirus, among others. The news sent stock prices skyrocketing and a hedge fund partially operated by Vaxart pocketed more than $ 200 million in profits.
[[[[Le New York Times]