Question:
In ________________ acquisition, a public company is taken over by a private company.
In ________________ acquisition, a public company is taken over by a private company.
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Reverse Acquisition = Private company takes over public company.
Think: “Reverse” = switching from private to public status quickly.
Updated On: Jul 4, 2025
- Friendly
- Reverse
- Backflip
- Hostile
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The Correct Option is B
Solution and Explanation
A Reverse Acquisition (or Reverse Merger) occurs when a private company takes over a public company. This allows the private company to become publicly listed without going through the lengthy process of an initial public offering (IPO).
Other types:
Friendly Acquisition: Acquisition agreed upon by both companies.
Backflip Acquisition: Acquiring company becomes a subsidiary of the acquired company.
Hostile Acquisition: Acquisition without the consent of the target company's management. Hence, the correct answer is (B) Reverse.
Friendly Acquisition: Acquisition agreed upon by both companies.
Backflip Acquisition: Acquiring company becomes a subsidiary of the acquired company.
Hostile Acquisition: Acquisition without the consent of the target company's management. Hence, the correct answer is (B) Reverse.
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