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Article: Backdoor listings have abysmal record.
- Article from:
- New Zealand Herald (Auckland, New Zealand)
- Article date:
- February 23, 2008
CopyrightCOPYRIGHT 2008 Independent News & Media PLC. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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BACKDOOR listings, which are a longstanding feature of the New Zealand and Australian stock exchanges, are in the spotlight again because of Blue Chip's problems and the collapse of The Joneses real estate agency.
These reverse listings, which involve the takeover of a non-listed company by a listed entity with no operating assets, are attractive to entrepreneurs because they do not require a prospectus and are cheaper than an initial public offering.
However investors get what they pay for as most backdoor listings have been unsuccessful.
A number of the NZX's more infamous companies were backdoor listed including:
Chase Corporation, ...