Reverse mergers and acquisitions are also called "shell listing". Shareholders of non-listed companies obtain absolute controlling rights of listed companies with the help of investment banking consulting companies, and then the company reversely acquires assets and businesses of non-listed companies, making them become subsidiaries of listed companies, thus achieving the purpose of indirect listing.
Due to the shrinking business and low valuation, shell companies need to avoid bankruptcy or delisting, so as to realize their own equity value.
Extended data:
The similarity between backdoor listing and shell listing is that they are both activities to reconfigure the shell resources of listed companies, and both aim at indirect listing. The difference between them is that shell listed companies first need to gain control over a listed company, while backdoor listed companies already have control over the listed company.
Reverse takeover is a normal form of company merger and acquisition, which has a long history in the United States and is a shortcut to the company's stock listing. At present, more and more companies adopt reverse takeover, and the number of companies listed by reverse takeover is basically the same as that listed by IPO every year, and it has a trend of exceeding in recent years.
Baidu encyclopedia-backdoor listing