Why Is OTR Acquisition (OTRA) Stock Up Today?

OTR Acquisition (NASDAQ:OTRA), a special purpose acquisition company, is climbing 5.5% in morning trading. Shares were up as much as 130% in the pre-market session. OTR has agreed to merge with Comera Life Sciences and shareholders approved the deal on May 10. After the merger occurs,  relatively few shares of Comera will trade on the Nasdaq exchange.

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Comera is developing “self-injectable” biologics. More specifically, the company says that it plans “to maximize the true potential of life-changing biologics by empowering patients to administer their own medicine via a single, simple injection.”

OTRA Stock Pops on Redemption News

In a May 10 filing with the U.S. Securities and Exchange Commission, OTR Acquisition reported that entities with nearly 9.7 million shares of OTR stock voted in favor of the deal, while entities with only 177,000 shares opposed the transaction.

According to the May 10 SEC filing, the SPAC has 13.24 million shares of common stock outstanding. However, owners of 10.279 million shares have “exercised their right to redeem their shares.” As a result, it appears that Comera will have a low float of approximately 3 million shares outstanding when it begins trading on the Nasdaq.

In general, a great deal of volatility has been exhibited by firms that, after merging with SPACs, have a relatively low number of shares trading on public exchanges. Many retail investors have generally been interested in buying the shares of such companies.

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On the date of publication, Larry Ramer did not hold any position (either directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Larry Ramer has conducted research and written articles on U.S. stocks for 15 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been GE, solar stocks, and Snap. You can reach him on StockTwits at @larryramer.

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