Cara Therapeutics announces 1-for-3 reverse stock split related to Tvardi merger
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Cara Therapeutics is based at 400 Atlantic St. in Stamford.
Stamford-based Cara Therapeutics Inc. announced Monday that its board of directors has approved a 1-for-3 reverse common stock stock split.
Cara’s common stock, which trades on the Nasdaq stock exchange under the symbol CARA, is expected to begin trading on a reverse stock split-adjusted basis at the opening of the market on Wednesday under the new name Tvardi Therapeutics Inc. and under the new symbol TVRD.
The change will follow the anticipated closing of Cara’s merger with Houston-based Tvardi, which is privately held.
Cara’s stockholders approved the reverse stock split during a special meeting on April 1, with the split to be effected at the board’s discretion of not less than 1-for-2 and not more than 1-for-4. The final reverse stock split ratio of 1-for-3 was approved by the board on April 1 and will become effective as of 4:01 p.m. Eastern Time on Tuesday, April 15.
At the effective time of the reverse stock split, every three issued and outstanding shares of the company’s common stock will automatically be combined into one issued and outstanding share of the company’s common stock without any change in the par value per share.
The reverse stock split will reduce the number of issued and outstanding shares of the company’s common stock from approximately 4.6 million to approximately 1.5 million (prior to giving effect to the closing of the merger). The reverse stock split will not change the authorized number of shares of Cara’s common stock.
Fractional shares will not be issued in connection with the reverse stock split, the company said. Stockholders who would otherwise be entitled to receive a fractional share will be entitled to receive a cash payment.
Tuesday morning, Cara’s stock was trading at $5.48 per share on the Nasdaq exchange.
Cara announced in December it had entered into an agreement with Tvardi Therapeutics Inc. to merge in an all-stock transaction.
The biopharmaceutical company also completed a 1-for-12 reverse stock split in December, in an effort to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market. That stock split proved successful.
Under the terms of the merger agreement, Tvardi will merge with a wholly owned subsidiary of Cara. Once completed, “pre-merger” Cara stockholders are expected to own about 17% of the combined company, while “pre-merger” Tvardi investors are expected to own about 83%.
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