01 Jan Top Reverse Merger Blog Posts 2014
Happy New Year everyone. May your 2015 be full of business and personal success! The New Year is a great time to look forward toward the coming year as well as glance back on what has occurred. In looking back, let’s take a look at some of the most popular blog posts of 2014 and how they can help you better understand how to best facilitate your next strategic reverse merger transaction. Just a side note, all the bolded titles below provide links to the precise article itself.
Rich Doctors & Reverse Mergers. Our most popular blog post comes from a Forbes.com article outlining the tactics of the world’s richest doctor: Patrick Soon-Shiong. A heated discussion ensued, revolving around the speculated potential of Dr. Soon-Shiong’s KEYO, a public shell which he currently owns and which some think he’ll be using for his next game-changing business.
Roll-ups and Industry Consolidation. As many know, taking a company public by either self-filing or reverse merger presents a great strategic advantage for those in consolidating markets where stock can be used in place of deals that would have typically required 100% cash. With the right strategy, many a entrepreneur has been able to reap the benefits of scale and the accretive value-add of bringing many private businesses together into a public company.
Special Purpose Acquisition Company (SPAC) Benefits. We work with existing shell corporations as well as manufacturing our own for use in RTOs. There are numerous advantages to using a public shell over another type of existing vehicle for taking your company public. Sometimes the advantages of a SPAC outweigh a self-filing or DPO, but it always depends on the company strategy and short/long term goals.
Process & Cost Analysis for Direct Public Offerings. DPOs differ in large measure from their counterpart the RTO/APO in that they ignore the need for a public shell and register shares directly with the SEC. In our experience, DPOs are slightly more expensive than the SPAC/PIPE/RTO route, but they have their advantages. This post outlined some of the details of the process itself and the relative costs at each phase.
Reverse Mergers: Fact vs. Myth. Because RMs have a bad reputation in the financial world, there are often a number of myths that are bound to precede any deal. This post helped to clear up some pretty blatant myths, many of which have steered potential deals away from the reverse merger for fear of the SEC.
Using Self-Directed IRAs in Reverse Mergers. Reverse mergers represent an excellent way to get into pre-public offering investments. These opportunities are often rare to the general public, but can be highly valuable in terms of the types of returns available to those who’re able to get an inside track on the deals. And, when investors are able to use a tax-advantaged retirement account like a self-directed IRA, they can avoid the tax burden of a quick and highly-lucrative investment return. It’s a strategy that was previously used by a select group of the ultra-wealthy, but the ability to invest in such deals has now grown and expanded to a much broader audience. Setting up a self-directed IRA costs as little as $2,000 for the proper structure.
Investor Exit via Reverse Mergers. The two main reasons companies typically go public is to raise capital or to provide a way for investors to exit their position with public stock liquidity. This article discussed some of the benefits of using a reverse merger as a private company liquidity tool, allowing investors to gain more liquid positions by selling their positions in once private businesses.
We’re expecting 2015 to be a great year for reverse mergers. 2014 had some great blog posts and interesting interactions with clients and investors. As we move forward on Alternative Public Offerings, we hope to continue to provide the needed education and insight through our blog that folks might expect from a professional consulting firm. To a great 2015!