10 times faster and One-third the cost of an IPO.



A reverse merger is a way for private companies to go public.

How it works:  A private company acquires the controlling interest of the public company’s stock thereby reversing into a public company and therein becoming a public company.  That’s the simple explanation.

Example:  A public company has virtually no business ‘BUT IS STILL FULLY REPORTING’.  This company could still be trading at $.01.  That’s called a trading SHELL.  The Key words here are “fully reporting”.  For my explanation, I will be writing about a Fully Reporting Shell.


            Note:  If not fully reporting you might as well register with the SEC and start all over.

In this scenario the private company has a book value of HALF A MILLION DOLLARS and reverses into a fully reporting public shell, trading at $.01.  What do you think the stock would be trading after the reverse?  You do understand public companies don’t usually trade at book value but in multiples of book.  Sometimes more than 10 times book.


Here’s why:  A private company that has a book value of $500,000.00 and 1 million shares outstanding, the share value is $.50.  ($500,000/1,000,00 shares).


Consider the same value and shares of the private company for this example.


In most cases, the public company is only trading the shares it has registered with the SEC.  These shares are called “the float” or “trading stock”.  If the public company has only 150 thousand (15%) of the 1 million shares outstanding in the float and a book of $500,000.00, the share would likely be trading at $3.33 ($500,000/150,00 shares “float”) or could be 10 times book at $5.00 a share.


That’s just one reason, but there are more.  The Public shares are more liquid, your stock is now bankable and can be used for acquisitions, there are more means for raising investment capital, and management can use stock incentive plans in order to attract and retain employees.




  1. Initial public offerings are an expensive exit route for company owners. Underwriters in the U.S. typically charge 5% to 7% of proceeds.  Underpricing of shares takes another 10% to 15%, on average. Total costs of $2,000,000.00 aren’t unusual

a. And the process can take more than a year.

  1. With a reverse merger into a fully reporting public company, it takes 90 days and costs as little as $400,000.00 with Due diligence and audit requirements.


There are certain requirements that must be met by the private company.


If a reverse merger interests you and you would like to know more, talk to me, I can help.

For a limited time, I am offering a Thirty (30) minutes FREE consultation.

Talk to me and tell me what it is you are trying to do.  Ask me all your important questions. 

If, after our talk, you feel like I can help you, then we can talk terms.

Contact ME, IT’S FREE AND COSTS you nothing. Email me to set up a zoom meeting.