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E-commerce company Newegg Inc became a hot topic of discussion in the stock market world after it announced the completion of its merger with Chinese medical equipment maker Lianluo Smart (NASDAQ:LLIT) on Thursday, May 20.
The joint entity has been renamed as Newegg Commerce (NASDAQ:NEGG), and its shares have begun trading on Nasdaq under the ticker of ‘NEGG’.
Lianluo Smart’s stockholders approved the merger and equity transfer deal on May 12, following which the Chinese firm combined with the US-based company.
In the wake of this development, Newegg stocks surged as much as 43.60 per cent on Thursday.
Newegg’s shareholders have an interest of nearly 98.68 per cent in the merged company, while present investors of Lianluo own the remaining 1.32 per cent. Newegg Inc appointed a new board of directors and executives of the joint firm.
The company’s shares were down over four per cent in premarket trading hours on Friday in the light of the merger announcement.
A Glance At Newegg Commerce Inc (NASDAQ:NEGG)
The firm is one of the leading online retailers in North America. Founded in 2001, Newegg also operates internationally and provides nearly tens of millions of active users a broad selection of advanced consumer electronics, smart home, entertainment and gaming items.
The California-headquartered enterprise extensively manages distribution sites throughout the US and Canada.
After merging with the Chinese medical device manufacturer, the company could expand its footprints in healthcare-related products across Asia as well as North America.
Let us look at the historical price performance from Lianluo Smart.
Lianluo Smart (NASDAQ:LLIT)
Lianluo Smart Limited was offering sleep respirational products, basic health-related items and medical compressors across China and globally. It was retailing its products mainly through distributors and direct delivery to hospitals and wellness facilities.
The company had been trading on the NASDAQ exchange since April 2010.
Lianluo stocks that were operating under the ticker of ‘LLIT’ stopped trading on Thursday after combining its shares with joint entity Newegg Commerce.
Its previous close price was US$ 9.22 apiece, with a market cap of US$ 44.76 million.
Lianluo stock was trading in the bullish zone with a one-year return of 283 per cent. It was up 219 per cent this year, as of May 20.
The Chinese company’s scrips surpassed the S&P 500 Healthcare Equipment (Sub Index) in the past one year.
Newegg's (Formerly Lianluo Smart) One-Year Price Movement Against Moving Average Multiple. (Source: Refinitiv)
Under the new ticker of NASDAQ:NEGG, the stock has been moving well above its moving average multiple, which indicates a short-term to long-term price rally at the previous closing price of US$ 13.24 apiece.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.
