Question

In ______ acquisition, a public company is taken over by a private company.

Options

• Friendly

• Reverse

• Backflip

• Hostile

Answer 1

In Reverse acquisition, a public company is taken over by a private company.

Explanation:

In a reverse acquisition (or reverse takeover), a private firm buys a public company to avoid the time-consuming and complex traditional Initial Public Offering (IPO) process. By combining with an already public shell organisation, the private company gets public status and can list on a stock exchange much faster.