Shares of intragastric balloon maker Obalon Therapeutics (NSDQ:OBLN) jumped as high as $10.71 today, or 568%, after the company announced a merger with ReShape Lifesciences (OTCMKTS:RSLS).
The San Diego-based company’s stock eventually closed at $9.52 per share, up 491%.
Obalon’s stock had closed at $1.61 yesterday.
ReShape Lifesciences also saw a substantial jump in its stock price. RSLS shares closed at $9.52 per share, up nearly 138%.
Obalon won FDA-approval for its gas-filled intragastric balloon system for obesity in 2016. It is currently the only company with such a product on the market in the U.S.
The merger with ReShape will allow the balloon system to become part of a portfolio of devices used to treat obesity and metabolic disease, including the Lap-Band adjustable gastric banding system and the ReShapeVest, which is an investigational device for treating obesity.
“We are excited with this opportunity to add Obalon’s FDA approved Balloon System to ReShape’s line of minimally invasive weight-loss solutions while also expanding our market reach,” said Bart Bandy, CEO of ReShape, in a statement.
Completion of the merger is subject to customary closing conditions. If the merger proceeds as planned, the resulting company will be renamed ReShape LifeSciences. Its NASDAQ ticker will be “RSLS.”
Executives at ReShape will lead the combined company.