Cara Therapeutics announces a 1-for-12 reverse stock split effective December 30, 2024, to comply with Nasdaq requirements.
Quiver AI Summary
Cara Therapeutics, Inc. has announced a 1-for-12 reverse stock split of its outstanding shares, effective at 5:00 p.m. ET on December 30, 2024, and a reduction in authorized shares from 200 million to approximately 16.67 million. The reverse split, which aims to help the company comply with Nasdaq's minimum bid price requirement, will result in the number of shares decreasing from about 54.9 million to around 4.6 million and will not impact stockholders' relative equity interests, except for adjustments for fractional shares, which will be compensated in cash. The company's stock will trade under the existing Nasdaq symbol "CARA" with a new CUSIP number starting December 31, 2024.
Potential Positives
- The reverse stock split aims to help Cara Therapeutics regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market.
- Following the reverse stock split, the number of issued and outstanding shares will be significantly reduced from approximately 54.9 million to approximately 4.6 million, potentially increasing the share price and appeal to investors.
- The reduction in total authorized shares demonstrates a more efficient capital structure, which could enhance investor confidence.
Potential Negatives
- The reverse stock split indicates that the company is struggling to maintain its stock price above the minimum bid requirement necessary for continued listing on the Nasdaq Capital Market, which could signal a lack of investor confidence and potential financial instability.
- The drastic reduction in the total number of authorized shares from 200,000,000 to 16,666,667 may limit the company's ability to raise capital in the future, potentially impacting its growth and operational capabilities.
- The press release does not provide a clear plan for how the reverse stock split will help the company improve its financial situation or regain compliance, leaving investors uncertain about the company’s trajectory and strategic direction.
FAQ
What is the effective date of Cara Therapeutics' reverse stock split?
The reverse stock split will be effective on December 30, 2024, at 5:00 p.m. Eastern Time.
How will the reverse stock split affect stockholders?
The reverse stock split will not change the relative interest of stockholders except for adjustments related to fractional shares.
What will happen to fractional shares after the reverse stock split?
Fractional shares will not be issued; stockholders entitled to them will receive a cash payment instead.
What is the new authorized share count after the split?
The total number of authorized shares will reduce from 200,000,000 to 16,666,667.
How does the reverse stock split relate to Nasdaq compliance?
The reverse stock split is part of Cara Therapeutics' plan to regain compliance with Nasdaq's minimum bid price requirement.
Disclaimer: This is an AI-generated summary of a press release distributed by GlobeNewswire. The model used to summarize this release may make mistakes. See the full release here.
$CARA Insider Trading Activity
$CARA insiders have traded $CARA stock on the open market 2 times in the past 6 months. Of those trades, 0 have been purchases and 2 have been sales.
Here’s a breakdown of recent trading of $CARA stock by insiders over the last 6 months:
- CHRISTOPHER POSNER (PRESIDENT AND CEO) has traded it 2 times. They made 0 purchases and 2 sales, selling 7,817 shares.
To track insider transactions, check out Quiver Quantitative's insider trading dashboard.
$CARA Hedge Fund Activity
We have seen 10 institutional investors add shares of $CARA stock to their portfolio, and 83 decrease their positions in their most recent quarter.
Here are some of the largest recent moves:
- ROSALIND ADVISORS, INC. removed 1,548,893 shares (-100.0%) from their portfolio in Q2 2024
- DISCIPLINED GROWTH INVESTORS INC /MN removed 822,675 shares (-42.5%) from their portfolio in Q3 2024
- ACUITAS INVESTMENTS, LLC removed 512,213 shares (-100.0%) from their portfolio in Q2 2024
- BNP PARIBAS FINANCIAL MARKETS removed 494,271 shares (-45.9%) from their portfolio in Q3 2024
- Y-INTERCEPT (HONG KONG) LTD removed 414,731 shares (-100.0%) from their portfolio in Q3 2024
- VERITION FUND MANAGEMENT LLC removed 390,602 shares (-100.0%) from their portfolio in Q2 2024
- GOLDMAN SACHS GROUP INC removed 389,681 shares (-100.0%) from their portfolio in Q3 2024
To track hedge funds' stock portfolios, check out Quiver Quantitative's institutional holdings dashboard.
Full Release
STAMFORD, Conn., Dec. 27, 2024 (GLOBE NEWSWIRE) -- Cara Therapeutics, Inc. (Nasdaq: CARA) (the “
Company
”), today announced that a 1-for-12 reverse stock split of its outstanding shares of common stock and reduction in the total number of authorized shares of its common stock from 200,000,000 to 16,666,667 will be effective as of 5:00 p.m. Eastern Time on Monday, December 30, 2024.
The Company's common stock will begin trading on a reverse stock split-adjusted basis at the opening of the market on Tuesday, December 31, 2024. Following the reverse stock split, the Company's common stock will continue to trade on the Nasdaq Capital Market under the symbol "CARA" with the new CUSIP number, 140755 208. The reverse stock split is part of the Company's plan to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market.
At the effective time of the reverse split, every 12 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 and the authorized shares of the Company’s common stock will reduce from 200,000,000 to 16,666,667.
Fractional shares will not be issued in connection with the reverse stock split. Stockholders who would otherwise be entitled to receive a fractional share will be entitled to receive a cash payment. The reverse stock split will affect all stockholders uniformly and will not alter any stockholder's relative interest in the Company's equity securities, except for any adjustments for fractional shares.
In addition, proportionate adjustments will be made to the number of shares underlying, and the exercise or conversion prices of, the Company's outstanding stock options, and to the number of shares of common stock issuable under the Company's equity incentive plans.
The reverse stock split will reduce the number of issued and outstanding shares of the Company's common stock from approximately 54.9 million to approximately 4.6 million.
About Cara Therapeutics
Cara Therapeutics is a biopharmaceutical company focused on transforming the way pruritus is treated. The Company developed an IV formulation of difelikefalin, which is approved in the United States, EU, and multiple other countries for the treatment of moderate-to-severe pruritus associated with advanced chronic kidney disease in adults undergoing hemodialysis. The IV formulation is out-licensed worldwide. For more information, visit
www.CaraTherapeutics.com
.
Forward-looking Statements
Statements contained in this press release regarding matters that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of these forward-looking statements include statements concerning the Company’s business, including those regarding the reverse stock split and authorized share reduction and the timing thereof, the impact of the reverse stock split and authorized share reduction on stockholders, including any adjustments that may result from the treatment of fractional shares, and option holders, the potential impact of the reverse stock split on the bid price of the Company's common stock, the potential for the Company to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market, the expected number of shares of common stock to be issued and outstanding following the reverse stock split, and other statements that are not historical fact. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include the risk that the Company may not be successful in exploring strategic alternatives and consummating one or more strategic transactions on attractive terms, if at all; the Company’s actual reductions in spending as compared to anticipated cost reductions; the Company’s costs of continuing to operate as a public company; and the other risks described more fully in Cara Therapeutics’ filings with the Securities and Exchange Commission, including the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and its other documents subsequently filed with or furnished to the Securities and Exchange Commission, including its Form 10-Q for the quarter ended September 30, 2024. All forward-looking statements contained in this press release speak only as of the date on which they were made. Cara Therapeutics undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
INVESTOR CONTACT:
investor@caratherapeutics.com
This article was originally published on Quiver News, read the full story.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
