reverse merger

reverse merger
USA
This term has several meanings. In the context of:
• Securities and capital markets, a process by which a private company goes public without a traditional initial public offering (IPO) by combining with an empty public entity shell company. For more information on reverse mergers as an alternative to an IPO, see Practice Note, Reverse Mergers: The IPO Alternative (www.practicallaw.com/1-500-3578).
• Mergers and acquisitions, a merger in which the buyer merges with and into the target company and the buyer ceases to exist as a separate entity. This structure is not very common. Most mergers are structured as forward mergers, forward triangular mergers or reverse triangular mergers. Parties may choose to use a reverse merger structure when there are significant change of control issues.

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

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