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Biotech / Medical : OmniCorder Technologies, Inc. (OMCT) -- Ignore unavailable to you. Want to Upgrade?

To: RikRichter who wrote (2)	3/21/2004 6:08:23 AM
From: Mahatmabenfoo	Respond to of 63

Rik wrote: "For the average investor, these low cost reverse mergers are like participating in an IPO." WRONGO! There's a big difference -- for one thing, reverse mergers are typically a way to avoid the SEC scrutiny that is required of an IPO. And they result in companies MORE LIKELY TO FAIL. A reverse IPO, unlike Rik's suggestion, are extremely negative indicators about a company's future -- except, perhaps, as a short-term pump. See below. Maybe Omnicorder will be one of those, but if so, remember to jump -- this company is trying to pump on the HOPE of sales, not real sales, which may not work in the current bull-weary declining tech market. - Charles ========================== invest-faq.com One study estimates that 53% of all companies obtaining public listings in 1996 did so through the "Reverse Merger". The same study concluded about 30% of newly publicly listed companies got there through Reverse Mergers in 1999.... There is a much higher failure rate amongst [reverse merger] companies versus the traditional IPO.... Through various methods, scam artists manage to accumulate large positions in the free trading shares of the shell company. An [reverse merger company] is consummated with a marginal private company, and the scam artists put together a massive publicity campaign designed to create activity in the stock. =========== Good article about reduced scrutiny for reverse IPOs stockpatrol.com Well, it certainly helps to consider the reasons why a private company might decide to go this route rather than hold out for an IPO. Reason No. 1 - Flying Under the Radar. A private company can become public without regulatory scrutiny. How?s that for a scary concept? Consider the strict criteria for a public offering. Before an IPO can go forward a detailed Registration Statement must be filed with the SEC (and generally, with various states in which the stock will be offered). These regulatory agencies will then look carefully at what the company has disclosed and ask for appropriate clarifications and changes to assure that the investing public is adequately informed. The IPO will not proceed, and the stock cannot be traded, until adequate disclosure has been made about the company?s business, its principal stockholders, its officers and directors, its financial condition, the underwriter and the risks to investors. The scrutiny doesn?t stop there. The company will have to satisfy certain requirements before it can be traded on the NYSE, NASDAQ, AMEX, regional stock exchange or the OTC Bulletin Board (yes, even the OTC Bulletin Board has listing criteria, although the Bulletin Board will not examine the content of the offering to the extent of most of the other exchanges). The goal of this process ? to make sure the public has all of the information it needs before investing in a company. The shell shuffle avoids virtually all of these obstacles