Speculation on Acquisition by Kodak : Viratek Stock Driven to All-Time High
Profit-seeking investors continued a three-day buying spree Friday, boosting common stock in Viratek Inc., manufacturer of an anti-viral compound, to an all-time high of $71.50 per share on rumors--repeatedly denied--that Eastman Kodak plans to acquire either the small drug maker or its parent, ICN Pharmaceuticals Inc.
ICN’s common and preferred shares also hit new highs this week as speculation spread that Rochester-based Kodak, which already owns a 10% stake in Viratek and a 5% share of ICN, will launch a takeover bid for one or both of the Costa Mesa firms, whose drug, Virazole, is being tested as a possible AIDS medication. ICN owns 47% of Viratek.
A spokesman for Viratek and ICN declined comment on the situation, but officials at Kodak said several times this week that the company has no plans to take over either of the pharmaceutical firms.
$26 Gain in Week
Viratek closed Friday at $71.50 a share in over-the-counter trading, up $8.50 for the day and a gain for the week of $26, or 57% of Viratek’s total market value.
“This stock shouldn’t be selling for what it is,” said Eugene Melnitchenko, who follows the pharmaceutical industry for the Dallas brokerage house of Rauscher Pierce Refsnes Inc.
New York Stock Exchange officials delayed the opening of ICN on Friday because of an imbalance of orders, with buyers outnumbering sellers.
Shortly after trading was allowed to commence Friday morning, ICN hit a new 12-month high of $17.25 a share. By the day’s close, however, it had slipped slightly to $16.75, up 25 cents for the day and a gain for the week of $3.875 a share--or 30% of its total market value.
Kodak Denies Interest
ICN’s preferred shares also hit a 12-month high of $37 a share Friday before closing at $36.375, up $2.625 for the day and $5.75 for the week.
Despite the persistent takeover rumors, Kodak on Friday repeated its assertion that, while it plans to increase its presence in the pharmaceuticals industry, it is not interested in acquiring ICN or Viratek.
“We have informed the stock exchange that Kodak has no plans to buy ICN or Viratek,” Kodak spokesman Henry Kaska said.