Is Reverse Takeover Good For Shareholders?

Is Reverse Takeover Good For Shareholders?
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1 Answer

  1. It can prove to be beneficial for shareholders to go for a reverse merger, specially if these original shareholders belong to a failed company. As the norms follows, these shareholders will have a chance to vote on whether to accept the merger or not. In most of the cases its better to accept the merger as their stock is not owning up to a worth, voting for the reverse merger might seem to present hope of eventually recovering their investment. In this case, they will receive a certain number of shares in the new company in exchange for the original shares, but that number will be considerably smaller than the number of shares in their original holding.

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