Everything you need to know about Reverse Shell Mergers by Ralph Amato
At the conclusion of a successful APO transaction, a company is publicly traded and has received its PIPE (equity) funding and has a combination of individual investors and a base of institutional investors. The company has the sponsorship of an investment bank or broker dealer and working towards an exchange [...]
The beauty of the reverse merger or APO is that a company can close on the transaction in as little as 30 – 45 days. However, the private company must complete an audit of its books by a PCAOB approved CPA firm prior to entering into an agreement to purchase the [...]
What differentiates an APO from a reverse merger is the simultaneous PIPE raise. A PIPE is when a publicly traded company sells its stock to investors in a privately negotiated transaction. The stock is normally sold at a discount to current market value and investors are normally acquiring unregistered “restricted” [...]
There are two parts that comprise an APO; the reverse merger and the PIPE. In the reverse merger, the private company becomes public by merging with or being acquired by a public “shell” company. The shell corporation or company is a public company that has maintained its financial reporting and [...]
In these challenging economic times it is far easier to raise capital when you can demonstrate an “exit strategy” for investors. Public companies can provide the exit strategy that investors seek. Stock in a publicly traded company is something investors are familiar with and understand. Many OTCBB companies raise [...]
It is no coincidence that Alternative Public Offering’s (“APO’s”) have become the “go to” vehicle for companies seeking to go public. Last year most of the tier one underwriters decided to convert to “banks” thus abandoning underwriting IPO’s altogether. Without someone to underwrite their IPO’s companies began searching for alternative [...]
Besides the time element of going public using a reverse merger or APO there are also other things to consider. By backing into an OTCBB shell you are guaranteed that your company will be publicly traded. If you file a registration statement with the SEC and an application to trade with FINRA there [...]
Let me explain why a reverse merger or APO may be the way to take your company public. A reverse merger or APO is really a direct route to going public. It eliminates the entire SEC registration process and the FINRA application process, both of which can take between twelve to sixteen months. [...]
In today’s economy private companies are finding it extremely difficult to get traditional bank loans and to raise private capital. Therefore, if a company wishes to survive they need to find alternative ways to raise capital. One of those ways is to take a company public via an Alternative Public Offering (”APO”). [...]
An Alternative Public Offering (”APO”) provides a way for a company to go public and without having to use traditional methods of filing a Form 10 or S1 registration statement with the Securities and Exchange Commission (the “SEC”). APO is usually associated with a PIPE (Private Investment of Public Equity) funding. The funding [...]
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