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A reverse merger occurs when a public entity acquires all of the stock of a private company in exchange for approximately 90% to 95% of the shares of the public entity.  Then the newly merged company takes on the name of the private company, installs the private company’s directors and officers, and files with the appropriate regulatory authorities.  This transaction and change of control completes the reverse merger, transforming the formerly private company into a publicly traded company.

  
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