What is the anticipated impact on liquidity and trading volume for both Scilex and Denali’s securities after the merger?

The SEC’s declaration that the Form S‑4 registration is effective clears the path for Denali Capital Acquisition Corp. (OTC: DNQAF) to merge with Semnur Pharmaceuticals, a majority‑owned subsidiary of Scilex Holding Co. (Nasdaq SCLX). When the business combination closes, Denali’s SP‑stock will be converted into ordinary shares of Scilex and the Denali ticker will be retired. This conversion will instantly expand Scilex’s public float and inject a sizable new pool of tradable shares, generating a pronounced short‑term surge in daily volume. Historically, SPAC‑to‑operating‑company conversions produce a “volume bump” as former SP‑holders scramble to either redeem their units or roll them into the surviving equity; the same dynamic will apply here, with Denali’s OTC‑traded shares likely seeing a one‑to‑two‑day “redemption‑to‑conversion” wave before the combined entity settles on the Nasdaq.

From a liquidity standpoint, Scilex will benefit from a deeper order‑book and tighter bid‑ask spreads as market makers absorb the influx of shares, while the removal of the OTC Denali ticker will concentrate all trading activity on SCLX. In the immediate post‑closing window, expect heightened volatility and a volume‑driven price swing—typically a 30‑50 % increase in average daily volume relative to the pre‑merger baseline. Traders can exploit this by positioning on the pull‑back after the initial volume‑driven rally, while keeping an eye on redemption rates (which can temporarily depress the share count) and any “lock‑up” constraints on insiders that might throttle supply. In short, the merger will markedly improve both the liquidity and trading volume of Scilex’s securities, and the former Denali shares will experience a brief, high‑volume conversion phase before fully merging into Scilex’s Nasdaq‑listed market.