Blank-check companies are inactive stock market shells that raise capital in order to merge with private companies, usually start-ups, which thus enter the stock market through the back door. Usually when the reverse merger takes place, the stock market shell takes the name of the other company, in turn allowing it to operate as a public entity for all intents and purposes.

For more information and real-life examples, BusinessWeek Online has recently dedicated attention to these entities through the following articles: Blank Check Blind Faith and Betting On Blank Check IPO’s.

The Wall Street Journal offers another prime example with their article, Blank-check co ATAC hopes to raise $200m on Wall Street.

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