Why Companies Complete Reverse Mergers

Reverse Mergers are a method of going public that is an alternative to an initial public offering (IPO). Reverse Mergers provide companies access to public equity and valuations, trading markets, and liquidity for investors.

Companies going public through a reverse merger are often seeking to:

• Raise capital simultaneously with going public
• Build their business with public capital
• Raise capital at better valuations than they could get privately
• Convert debt to equity
• Increase the speed of going public
• Assure themselves of becoming public without market risk such as an IPO
• Set the company up for future funding with less dilution
• Complete acquisitions with public paper instead of cash
• Attract employees with equity
• Provide minority shareholders with liquidity
• Redo the estate plan on a tax-free basis