Shares of ARCA biopharma, Inc. (ABIO) surged over 100% on Wednesday morning after Oruka Therapeutics agreed to buy the company in an all-stock deal.
ABIO is currently trading at $3.4600, up $1.7500 or 102.3392%, on a huge volume of 32 million shares, compared to average volume of 26 thousand, on the Nasdaq. The stock opened its trading at $2.9100 after closing Tuesday at $1.7100. The stock has traded between $1.5600 and $3.7400 in the past 52-week period.
Following the deal, ARCA stockholders are expected to own about 2.38% of the combined company and Oruka stockholders are expected to own around 97.62% of the combined company.
ARCA is anticipated to contribute $5 million to the combined entity and expects to pay a dividend to pre-merger ARCA stockholders of about $20 million.
Upon completion, the combined company plans to operate under the name Oruka Therapeutics, and trade on Nasdaq under the ticker symbol, ORKA. It will be led by Lawrence Klein, Oruka's current Chief Executive Officer. The combined company's cash balance at closing is expected to fund Oruka's operations through 2027.
Oruka expects to advance ORKA-001 and ORKA-002, potentially best-in-class antibodies targeting IL-23p19 and IL-17A/F, respectively, into clinical trials in 2025.
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