The process for an IPO can be tedious and long. However, the availability of a listed shell company alleviates the time consuming process on the new owners since the shell company is already in compliance with the rules of the listing manual.
A Stock Market listing is not cheap, the final proceeds received from the listing may only be enough for the company to pay for part of its equipment costs. This is part of the reason why reverse takeovers (RTOs) occur. Some companies don’t wish to spend unnecessary money on listing expenses thus RTOs are often a much cheaper option.
*Content sourced for this article by: sharesinv.com, investopedia.com
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