Reverse Takeover: A Back Door to the market

The access of capital and the high market growth has resulted in an increase in the quantity of companies going public in Sweden. Most companies go through with the initial public offering (IPO) process, but there has been an increase of companies that choose to go public through an alternative method. A reverse takeover is an alternative going public transaction that has been more common and accepted over the recent years in Sweden. The going public process is reverse compared with an IPO and the method is known as the “back-door” to the market. The purpose of this report is to analyze reverse takeover on the Swedish stock exchange as an alternative to the traditional IPO, with focus on the factors behind the transaction. ….


1 Introduction
1.1 Background
1.2 Problem Discussion
1.3 Purpose
2 Method
2.1 Research approach
2.2 Research Method
2.3 Data Collection
2.4 Sample selection
2.4.1 Interviews
2.4.2 Statistical research
2.5 Theory Selection
2.6 Validity and Reliability
3 Frame of Reference
3.1 Going Public
3.1.1 Access to the Capital Market
3.1.2 Obstacles for Going Public
3.2 Merger and Acquisition
3.2.1 Motives
3.3 Reverse Takeover
3.3.1 Low Quality Firms Use Reverse Takeovers
3.3.2 The Importance of Reverse Takeovers
3.3.3 Future Development of Reverse Takeover Firms
4 Empirical Findings
4.1 Transaction structure
4.2 Motives
4.3 Potential risks
4.4 Manage risks
4.5 The public company
4.6 The private company
4.7 Reverse Takeovers in the Swedish Capital Market
4.7.1 Sample
4.7.2 Profitability
4.7.3 Industry
5 Analysis
6 Conclusion and Discussion
6.1 Conclusion
6.2 Reflections
6.3 Critique of Chosen Method
6.4 Further research

Author: Svensson, Joel,Thorstensson, Martin,Fältmars, Håkan

Source: Jönköping University

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