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While the DFC and Kodak have signed a letter of interest, the group hasn’t finalized the loan terms and said it won’t disclose them. “I think it’s priced like a commercial loan would be to the extent they could get one,” Glaccum said.
Kodak’s Executive Chairman James Continenza said in an interview with CNBC he’s confident the loan will go through. “One of our core competencies has always been chemistry, for over 100 years we’ve been doing chemistry,” Continenza said. “We realized we could do more. The government realized they could do more. They kind of reached out, and we found a path that makes a lot of sense for the American public to help bring the pharmaceutical protections back to America.”
Continenza and board member Philippe Katz bought Kodak shares in June. Continenza bought almost 47,000 shares, while Katz bought 10,000 shares in two separate transactions. David Bullwinkle, the company’s CFO, purchased almost 2,900 shares in May. Kodak said Continenza’s purchases are a continuation of “ongoing, regular investments in Kodak and are in full compliance with regulatory guidelines for investment activity.”
News of the planned loan leaked Monday though at least one local publication, RochesterFirst.com, which later deleted the story and an associated tweet. The same day, 1.65 million Kodak shares changed hands, compared with just under 75,000 shares on Friday.
This wouldn’t be Kodak’s first attempt at pharmaceuticals. Kodak entered the business in 1988 with the acquisition of Sterling Drug Inc. for US$5.1 billion. The deal had a similar rationale: Kodak would apply its expertise in chemicals to pharmaceuticals. “For Kodak shareowners, the merger will accelerate our entry into the US$110 billion-plus worldwide pharmaceutical industry,” Colby Chandler, Kodak chairman and chief executive said at the time. “And it will provide us with attractive long-term sales and earnings potential.”