What Is A Reverse Takeover?

What Is A Reverse Takeover?
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  1. According to a definition on Wikipedia, “A reverse takeover or reverse merger takeover is the acquisition of a public company by a private company so that the private company can bypass the lengthy and complex process of going public. The transaction typically requires reorganization of capitalization of the acquiring company.” Broadly speaking, it is a type of merger that private companies involve in so as to become publicly traded without going for an initial public offering . Firstly, the private company buys enough shares to control a publicly traded company. The private company’s shareholder then exchanges its shares in the private company for shares in the public company.

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