Reverse Merger with an OTC Shell

Such companies are generally traded in the Over The Counter or OTC market, in the OTC Bulletin Board or in the Pink Sheets. Shells with assets may trade on an exchange, if they meet the exchange listing requirements.

Key Benefits to a Reverse Merger with an OTC Shell

Faster than an IPO
Cheaper than an IPO
You set the terms, not the IPO underwriter -- you can get full value for your company
You don't have to give up control
Be sure of going public even in a bad market
Makes it easier to raise money because your investors can see an exit strategy -- selling their stock in the public market
You can give stock options to employees
May solve estate tax problems

Costs

Costs vary widely. You can buy control of a shell for cash or merely allow the shell owner to keep part of the stock, or any combination thereof. This depends on the probable market value of your company and your willingness to give up equity. The total cost also depends on legal and accounting expenses. On the low side, the cost of a shell may be $50,000, and on the high side, deals costing several hundreds of thousands of dollars or more have been reported. If the shell has assets, shell owners want to receive something for the value of those assets as well.

To learn more about how to go public using an OTC shell or public shell for a reverse merger, click here now.

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