Merger announcements often result in stock price movements, and that is what happened with ONVO stock this morning. This morning, Organovo Holdings Inc (NASDAQ:ONVO) announced it has entered into an agreement for one of its subsidiaries to be merged with privately-owned clinical-stage biopharmaceutical firm Tarveda Therapeutics.
Merger Details
After the merger with the Organovo subsidiary, the new entity will be known as Tarveda Therapeutics and will trade on the stock market under the symbol TVDA. The stock will be listed on NASDAQ. Tarveda shareholders will have ownership of 75% of the new company, while the residual 25% will be held by Organovo shareholders. The two parties believe that the deal is going to be concluded by the time Q1 2020 ends. As ever, the deal is reportedly going to be mutually beneficial for both the companies.
The transaction is going to be conducted entirely in stock. It is a significant development for Organovo Holdings, as evidenced by the market’s positive reaction. ONVO stock soared by as much as 20% to $0.60 on Monday and has emerged as one of the biggest early gainers of the day today.
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The Chief Executive Officer and President of Organovo, Taylor J. Crouch, spoke about the importance of the merger: “Tarveda is supported by a strong syndicate of investors including Novo A/S, Versant Ventures and ND Capital (NanoDimension) and a highly seasoned management team with prior public company experience.”
The Chief Executive Officer of Tarveda, Drew Fromkin, stated that the company is now working on a range of new products. It is a critical time for the company, making it an opportune moment for Tarveda to turn into a publicly-traded company. Tarveda expects to move forward with two of its oncology programs, called PEN-866 and PEN-221, in the near future.
Despite today’s jump, ONVO stock is still down 40% year-to-date.
Featured image: DepositPhotos © mikkolem
