Mega really wants you to know it’s safe…
Mega, the online storage company founded by Kim Dotcom, is going public in an alternative way. The company will be acquired by a New Zealand-based publicly-traded firm, TRS Investments, in a reverse takeover. This means TRS will buy Mega, become 99 percent owned by that company’s stockholders, and ultimately rename itself Mega.
According to the AP, reverse takeovers (versus an IPO) are typically used to save time and money while avoiding greater regulatory scrutiny. The NZX stock market states “reverse” or “backdoor” listings are allowed, but it notes they require adequate disclosure standards.
TRS’ penny stock went shooting up 900 percent on news of the acquisition, reaching NZ$0.01 per share from its previous closing price of NZ$0.001. It’s welcome financial news since TRS’s most recent half-year financial report showed that the company lost NZ$12,000 ($10,267) between March 30, 2013 and September 30, 2013.
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