We provide reverse takeover structuring and consulting services to help you achieve a rapid time-to-market.
The details of Reverse Takeover (RTO) are as follows:
 

Preliminary Preparation

 

  • Determine the target company
    Find a suitable shell company as the target of the reverse takeover. Shell companies usually refer to those companies that are listed but with less business, lower market capitalization and relatively simple financial status.
    Analyze the shareholding structure, indebtedness, legal disputes and other factors of the shell company to ensure that it meets the acquisition requirements.

 


  •  Assessing feasibility
    Conduct a comprehensive assessment of the feasibility of a reverse takeover, including the value of the target company, acquisition costs, potential risks, etc.
    Consider the industry outlook, market demand, competitive landscape and other factors to determine whether the reverse takeover will help realize the enterprise’s strategic objectives.

                                                                                                                       Design of transaction structure

 

  • Acquisition method
    Determine the specific mode of reverse takeover, common asset injection, equity swap, etc..
    Asset injection refers to the acquirer will inject its own high-quality assets into the shell company, to realize the asset listing; equity swap is the acquirer with its own equity in exchange for the equity of the shell company, so as to obtain the control of the listed company.

 


  • Pricing strategy
    To set a reasonable acquisition price, it is necessary to consider factors such as the market value and asset status of the shell company, as well as the value of the acquirer’s assets and future development potential.
    A variety of valuation methods, such as the market method, income method, asset-based method, etc., can be used to comprehensively determine the acquisition price.

 


  • Financing Arrangement
    If financing is required to complete the reverse takeover, develop a corresponding financing program. Financing methods may include bank loans, bond issuance, equity financing, etc.
    Evaluate the costs and risks of differen

Due Diligence

  • Financial Due Diligence
    In-depth review of the financial status of the shell company, including financial statements such as the balance sheet, income statement, and cash flow statement.Verify the authenticity and accuracy of financial data, and evaluate the asset quality, debt level, and profitability of the shell company.
    Find potential financial risks, such as debt disputes, tax issues, and accounting fraud.

 

  •  Legal Due Diligence
    Review the legal documents and compliance of the shell company, including the company’s articles of association, contracts, and litigation records.
    Assess legal risks, such as property rights disputes, contract breaches, and compliance risks.
    Ensure the legality and compliance of the reverse acquisition.

 

  •  Business Due Diligence
    Understand the business model, market position, and competitive advantages of the shell company.
    Analyze the synergy between the shell company’s business and the acquirer’s business, and evaluate the potential and difficulty of integration.
    Investigate the management team, technical strength, and customer resources of the shell company.

Negotiation and contract signing

 

  • Negotiation strategy
    Develop negotiation strategy and clarify negotiation goals and bottom line.
    Establish a professional negotiation team, including experts in finance, law, business, etc

 


  • Contract terms negotiation
    Negotiate the contract terms of the reverse acquisition, including acquisition price, payment method, delivery conditions, performance commitment, breach of contract liability, etc.
  • Ensure that the contract terms are fair and reasonable and protect the interests of the acquirer.

 


  •  Contract signing and announcement
    After reaching an agreement, sign the reverse acquisition agreement.
    In accordance with securities regulatory regulations, timely issue announcements and disclose relevant information about the reverse acquisition to the public.

Integration and subsequent development

 

  • Business integration
    Integrate the businesses of the acquirer and the shell company, optimize resource allocation, and achieve synergy.
    Formulate a unified business development strategy, expand market share, and improve the competitiveness of the enterprise.

 

  • Financial integration
    Integrate the financial system, unify accounting policies and financial management processes.
    Optimize capital management, improve capital utilization efficiency, and reduce financial risks.

 

  • Management integration
    Adjust the management team, optimize the organizational structure, and improve management efficiency.
    Establish an effective internal control system and strengthen risk management.

 

  • Subsequent financing and development
    Carry out subsequent financing according to the development needs of the enterprise, such as private placement, bond issuance, etc.
    Continuously enhance the core competitiveness of the enterprise and achieve long-term stable development.