lazzare,
My interest in shells and reverse mergers dates back to the mid-90s. I took a high tech company public in 1995, and after it ceased operations I executed a reverse merger with the shell. Because we did not have funds for an attorney, so I ended up doing all of the legal work on the transaction. It was quite a learning experience. Unfortunately, we did a deal with some guys who had some – how shall I phrase it – issues. Rule 1 when facilitating a reverse merger: Make sure you protect your own interests and get compensated.
The experience has paid some dividends. I have a fairly good track record trading higher quality reverse merger and SPAC plays and I am currently in the process of creating a shell for a client, a far easier and cheaper task than I anticipated. I should be filing an amended S-1 next week.
I have been very careful not to “pump” the SPAC concept. It has proven to be an expedient way for many second and third tier companies to go public, but a lot of them have crashed and burned. Ultimately, the success of a company is determined by their ability to execute on their business plan, not the fact that they are publicly traded.
I had no idea that I would be tracking 264 filings when I started the SPAC thread. I think that the activity will start to pick up again in 2010, featuring smaller offerings and a focus on Asia.
I have been following HOL, although I do not currently own any shares. It seems that HOL is not in compliance with Section 341 of the AMEX Company Guide. When an AMEX listed company executes a reverse merger with an unlisted entity (which becomes the surviving entity), the newly merged entity must satisfy the initial AMEX listing requirements. The AMEX does not allow “back door listings.” The NYSE and NASDAQ have comparable provisions. China Ceramics was the surviving company in this transaction, essentially a new unlisted entity as far as the AMEX was concerned. The newly merged company actually re-domesticated in the British Virgin Islands. My guess is that HOL could maintain its listing simply by filing a new application. Then again, some Chinese companies have not been too enthused about full transparency.
Regards,
Glenn |
