Replies to post #27739 on Woodbrook Group Holdings Inc (WDBG)

[Welcome2Pinkyland]

Nice. Thanks.

[DeltaWarrior]

Using a Reverse Takeover to Access U.S. Markets

A foreign company may use an RTO as a mechanism to gain entry into the U.S. marketplace. If a business with operations based outside of the U.S. purchases enough shares to have a controlling interest in the U.S. company, it can move to merge the foreign-based business with the U.S.-based one, gaining access to a new market without the costs traditionally involved.

What is a Reverse Takeover - RTO

A reverse takeover (RTO) is a type of merger that private companies engage in to become publicly traded without resorting to an initial public offering (IPO). Initially, 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. At this point, the private company has effectively become a publicly traded company.


An RTO is also known as a reverse merger or a reverse IPO.

BREAKING DOWN Reverse Takeover - RTO

Under a reverse takeover (RTO), a private company does not need to pay the expensive fees associated with setting up an IPO. However, the company does not acquire any additional funds through the merger, and it must have enough funds to complete the transaction on its own.

While not a requirement of an RTO, the name of the publicly traded company involved is often changed as part of the process. Additionally, the corporate restructuring of one or both of the merging companies are adjusted to meet the new business design.

It is not uncommon for the publicly traded company to have had little, if any, recent activity, existing as more of a shell corporation. This allows the private company to shift its operations into the shell of the public entity with relative ease, all while avoiding the costs, regulatory requirements and time constraints associated with an IPO. While a traditional IPO may require months or years to complete, an RTO may be complete within weeks.

https://www.investopedia.com/terms/r/reversetakeover.asp

[cjstocksup]

Here’s what Michael Doherty our new CEO and President said was the process last week in a recent article about the NHPI merger:


-Speaking to International Adviser, Woodbrook chief executive Michael Doherty explained: “The group decided to pursue an IPO through a private equity firm in the US.

“Through discussions, we found that the easiest solution would to be a reverse public offering. It works by us identifying a company that is already listed, with a clean share class, and purchasing it.”
Also known as a reverse takeover, the move sees Doherty installed as chief executive and president of the newly restructured business.



https://international-adviser.com/woodbrook-group-acquires-us-firm-and-eyes-nasdaq-listing/