How to understand reverse takeover?

Reverse M&A (also known as shell listing) means that the shareholders of a non-listed company control a shell company (listed company) by buying its shares, and then the company reversely acquires the assets and business of the non-listed company, making it a subsidiary of the listed company. Shareholders of the original unlisted company can generally obtain 70%-90% of the controlling shares of the listed company.

Anti-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 anti-takeover, and the number of companies listed by shell and IPO is basically the same every year (350 companies).

A typical shell listing includes two trading steps. First, shell trading, in which shareholders of non-listed companies absolutely or relatively control a listed joint-stock company by purchasing shares of listed companies; The second is asset transfer transactions, in which listed companies acquire non-listed companies and control their assets and operations.