Alliqua Biomedical Inc (NASDAQ: ALQA) is flying in the market today, and for good reason. The company announced spinoff and merger news that excited investors, sending the stock screaming for the top. Today, we’ll talk about:
- The news;
- what we’re seeing from ALQA as a result; and
- what we’ll be watching for with regard to the stock ahead.
ALQA Announces Spinoff And Merger News
As mentioned above, Alliqua BioMedical is having an incredibly strong start to the trading session this morning after announcing spinoff and merger news. In a press release, the company said that it and TO Pharmaceuticals plan to spin off AquaMed Technologies and merge it with TO Pharmaceuticals.
In the release, ALQA said that the move will create a new public company called TO Pharma that will be focused on discovering, developing and commercializing novel therapeutics. To do so, the new company will base research on TOP’s proprietary cannabinoid product platform in a number of FDA-regulated clinical indications as well as certain OTC Markets.
Once the spinoff and merger is complete, the company said that Alliqua’s former shareholders will retain a minority stake with the former members of TOP holding the majority of TO Pharma. The new company also plans to apply to list its shares of common stock on the NASDAQ.
In a statement, Dave Johnson, CEO at ALQA, had the following to offer:
We are extremely excited to form this exciting new company in a fast-growing sector of the market… TOP is a leader in the cannabinoid therapy space, and we look forward to creating TO Pharma as a global leading cannabinoid pharmaceutical therapy-based company.
The above statement was followed up by Seth Yakatan, CEO at TOP. Here’s what he had to offer:
We are excited to combine TOP’s technology and research with the unique capabilities of AquaMed’s hydrogel technology, to form a truly global pharmaceutical company. We are excited and confident that the anticipated development of the combined business should generate significant shareholder value.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. In the case of Alliqua Biomedical, the news proved to be positive. After all, the spinoff and merger will create a new entity of value and hand that value down to shareholders. So, it’s no surprise to see that excited investors are sending the stock on a run for the top. As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (10:59), ALQA is trading at $4.16 per share after a gain of $2.53 per share or 155.21% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the iWatch Markets team will continue to keep a close eye on ALQA. In particular, we’re interested in following the spinoff and merger to ensure the closing of the transaction. While the transaction has been announced and agreed to, it is still subject to customary closing conditions. Nonetheless, we’ll continue to keep a close eye on the news and bring it to you as it breaks!
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