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Wow, is this debate still ongoing!!
Yes that's why I'm still on the side of Novacyt acquired Lab21. Lab21 was incorporated into Novacyts accounts. The terminology and accounting treatment being used contradict it being a reverse merger. I genuinely believe the reverse merger label has come from the FCA a few years later.
I think the FCA have confused matters by declaring it a reverse merger which they seem to have done because Novacyt was going to effectively double in size, go into different product markets and have several changes at board level. To the FCA, those were significant enough to label it a reverse merger.
Outside of that label, to me everything else points to a simple share acquisition of Lab21 by Novacyt with the bod change being part of the terms. The legal company stays the same, the accounts stay Novacyt, the shares stay Novacyt, the name stays Novacyt. Lab21 become a 100% owned sub, so they still exist and all their contracts etc are still valid and they still produce statutory accounts as if nothing has changed for them other than they are now owned by a parent. The Novacyt accountants will be responsible for consolidated the group accounts.
That to me makes the most sense but I'm happy to agree to disagree if you are.
one thing is everyone seems to put owning the majority of shares as a requirement. I still think it's not necessary because shares are owned by investors who want a good return so want the company well run (or taken over and run better) so will vote for what's best for the company which is what a CEO and/or a company that took over should want too, so everyone should be on the same page, and if todays board can get all they want voted through owning nothing relevant why does a majority holding count.
Although I wonder, as Novacyt had ii's back then whose shares were prob non-voting, Lab21 may have had a majority of the voting share float at the time.
But does it matter, the takeover was only a few years ago, Lab21 SH sold up for a profit since then which was the objective, no-one noticed I bet and Novacyt carried on. GM still turned up and did his job
Lets go full techie. Here's a PWC tutorial, it's for the US again.
https://viewpoint.pwc.com/dt/us/en/pwc/accounting_guides/business_combination/business_combination__28_US/chapter_2_acquisitio_US/210_reverse_acquisit_US.html#:~:text=In%20a%20reverse%20acquisition%2C%20the%20financial%20statements%20of%20the%20combined,connection%20with%20the%20reverse%20acquisition.
you may need to fiddle to get it up, if page is shaded, do a back page and should be ok.
Only had a quick scan but looks an interesting read, here's one answer re financial statements ( I had read that, but didn't understand, it was a bit vague)
"The legal acquirer is the surviving legal entity in a reverse acquisition and continues to issue financial statements. The financial statements are generally in the name of the legal acquiree because the legal acquirer often adopts the name of the legal acquiree. In the absence of a change in name, the financial statements remain labelled as those of the surviving legal entity. Although the surviving legal entity may continue, the financial reporting will reflect the accounting from the perspective of the accounting acquirer, except for the legal capital, which is retroactively adjusted to reflect the capital of the legal acquirer (accounting acquiree) in accordance with ASC 805-40-45-1."
BH, I don't actually believe it was a reverse merger in the traditional sense. The only place I have seen 'reverse merger' mentioned is in the FCA approved AIM submission document. The FCA has a very different definition of what a 'reverse merger' is. Extract below:
Definitions
LR 5.6.4R29/07/2016
RP
A reverse takeover is a transaction, whether effected by way of a direct acquisition by the issuer or a subsidiary, an acquisition by a new holding company of the issuer or otherwise, of a business, a company or assets:
(1) where any percentage ratio is 100% or more; or
(2) which in substance results in a fundamental change in the business or in a change in board or voting control of the issuer.
I believe the stock for stock deal with Lab21 would have certainly ticked box 2 therefore falling under a reverse merger.
That is the only explanation I have because if it was a traditional reverse merger then Lab21 would be the acquirer and Lab21 financial accounts would have been the leading set of accounts (according to your link), but this is not the case as it is Novacyt accounts that remained the leading set.
All the documents I have read is that Novacyt acquired Lab21 which suggests it wouldn't be a traditional reverse merger.
It certainly is clear as mud in fairness.
"**************/Share Acquisition
The other most common reverse merger structure involves a ************** or share acquisition, whereby Pubco acquires Privco as a wholly-owned subsidiary through the issuance of Pubco shares, cash or a combination of both. It is similar to a triangular merger in that after the merger is completed, Privco is a wholly-owned subsidiary of Pubco. The advantage of a ************** rather than a triangular merger is the lack of additional state filings in connection with the formation of Pubco’s wholly-owned subsidiary and the filing of the merger documents. In addition, ************** agreements are typically used where Privco is not a U.S. based company, as cross-border mergers are nearly impossible and may be prohibited under the laws of Privco’s incorporation."
https://srf.law/resources/reverse-mergers/
Best explainer of reverse takeovers I can find atm. It's US, but works for Europe. Also note it's best method for cross-border reverse takeovers
This the bit you keep seeing and not understanding.
"**************/Share Acquisition
The other most common reverse merger structure involves a ************** or share acquisition, whereby Pubco acquires Privco as a wholly-owned subsidiary through the issuance of Pubco shares, cash or a combination of both. It is similar to a triangular merger in that after the merger is completed, Privco is a wholly-owned subsidiary of Pubco."
It has to be recorded like that. Like a takeover. That's why the reverse bit is important. Otherwise it is a takeover unless you understand it happened in reverse.
Also your Investopedia article explaining reverse takeovers is really bad, it's a cut and paste of a flagged wiki
Also your reverse takeover example you used to prove your other post wrong is a Reverse Triangular Merger, which is new to me but covered on the link.
It's a corp law firm and not a blog
Amers, in all fairness I've learned more about my investment in this thread than I have in all other threads for the last 4 weeks put together. No disrespect to anyone intended but ncyt aren't exactly forth coming with news these days.
Hi DRB/BH/PI100/Wilson - can you all please once and for all put your disagreement over RTO to bed, as the whole BB is fecking sick of it. I could put you dummies in filter bin, but I won't as from time to time you do post some decent research. Please let go and act like grown-up's.
I missed off that none of the 3 points are conclusive. A bit like only having circumstantial evidence in a court case.
The transaction details give you everything you need to know. From the accounts 2015:
8.1 CHANGES IN SHARE CAPITAL
As of 31 December 2015, Novacyt’s capital consisted of 7,189,213 shares with a par value of
1/15th of a euro each, i.e. share capital of €479,280.
The most recent transactions on share capital can be summarised as follows:
- The General Meeting of 13 June 2014 approved the contribution to Novacyt of 100% of the
shares of British company Lab21 Ltd paid for exclusively by Novacyt securities. The Lab21
Ltd shares were contributed at a value of €18,846,745.90. The contribution resulted in a
capital increase of €168,203.93 and a contribution premium of €18,678,550.97
BH, the term reverse merger doesn't mean Lab21 acquired Novacyt. You use it as if it proves your point.
Your argument is:
1. GM became CEO
2. The AIM submission document states 'reverse merger'
3. Michel says so.
This is everything you have yes.
Each one could definitely be an indicator for Lab21 buying Novacyt but when you dig deeper the evidence shows Novacyt acquired Lab21.
This thread has all the evidence laid out within it. All the research has been done and posted yet you still see those 3 points above as being fundamental to the point where nothing else matters.
You have to be dynamic and willing to change your mind when presented with strong evidence. You'd be a terrible juror.
BH, I will confess that I initially also thought reverse mergers/takeovers solely meant a private company buying into the market but when you showed me the AIM submission document I just had to investigate. Now my research has lead me to understand that reverse mergers are way more complex than I assumed and it helped me to understand the transaction between Novacyt and Lab21.
If I found genuine evidence to support your theory then I would consider it and research it but everything I have found supports Novacyt being the acquirer (except Marcel). Maybe you will do the same and we can move on.
Whilst I'm waiting on you baby shot oops sorry babyhuey liar or honest mistake?
https://twitter.com/NovacytGroup/status/1562751394658263041
Thinks that's a bit of an invite to all the gob huey's to pop along sorry fat fingers holders I meant.
Sat 01:48
"Very last one now.
Reverse takeover you say.
What Is a Reverse Takeover (RTO)?
A reverse takeover (RTO) is a process whereby private companies can become publicly traded companies without going through an initial public offering (IPO).
To begin, a private company buys enough shares to control a publicly-traded company.
Now control is the important word. Huey, I know you don't think % means anything in business but do you know what % is needed to gain control?
Secondly, it was Novacyt giving shares to Lab21. Usually it is the buyer that gives shares/cash to the seller.
This combination of companies doesn't seem to tick the reverse takeover boxes either.
I know you don't like Google but you really need to start using it. You'll learn loads before embarrassing yourself on here.
Lab21 acquisition - put to bed
Lab 21 closure - put to bed
Me - going to bed"
what this idiotic interpretation, no you posted that.
But my post you just quoted, yes it was a reverse takeover.
Only thing you keep proving is that you're an idiot by
A) pretending Michel Dyen &Co. is a blogger. It's a global investment banking firm.
B) pretending your post is mine. It's your post (But I agree it's totally stupidly wrong)
With regards to your new found most trusted man in investing idol Marcel, well he's just wrong. Sorry. Mergers usually require only one acquirer. They can't both have acquired each other.
Obviously, if Lab21 had acquired Novacyt then you'll be able to provide evidence of the consideration that Lab21 paid.
I mean, it's clear for all to see what Novacyt paid yet you disregard this.
BH
A post of yours earlier in this thread:
"Novacyt has a successful track record of undertaking acquisitions, including that of Lab21 (through
a reverse merger) in July 2014 ....."
that's their admission doc for an AIM listing, page 13 (unlucky for some)
So despite it referring to the deal as a Novacyt acquisition you picked up on the reverse merger comment and assumed that must mean Lab21 acquired Novacyt. I'm assuming that's what you meant by "unlucky for some" as if the term "reverse merger" somehow settled our debate in your favour.
I have since proven that your simple understanding around reverse mergers is wrong.
I don't really have time to keep reminding you of what you have posted.
Crack on babyhuey bring my post up where I've referred to that company as marcel and I'll buy you a months worth of nappies.
I'm waiting.
No, the idiotic thing was claiming I had said it (indeed my theory was hanging on it, apparently) and it was your own idiotic rambling lecturing rude rant.
I actually thought yourself, and Free Willy claiming that a global investment firm was actually a Spanish blogger was the most idiotic thing an adult would do.
But you've outdone that by accidently arguing with yourself.
And you post this idiotic rubbish
"I don't think I'm humouring him B2. I think he's genuinely confused and way out of his depth in business. I'm happy to help fellow investors learn and understand things but Huey took it a little too far. Point taken though."
And you truly believe it, because you're so dumb. You out-dumb Free Willy, which isn't easy.
BH, Ah, some people have written entire text books on reverse mergers and takeovers and you think my posting was giving you an entire summary in one tiny paragraph.
It was an extract to prove a point which you clearly missed.
Oh and your communication with me has been exemplary. Not! Very hypocritical to call someone out for being rude to you.
Sat 01:48
"Very last one now.
Reverse takeover you say.
What Is a Reverse Takeover (RTO)?
A reverse takeover (RTO) is a process whereby private companies can become publicly traded companies without going through an initial public offering (IPO).
To begin, a private company buys enough shares to control a publicly-traded company.
Now control is the important word. Huey, I know you don't think % means anything in business but do you know what % is needed to gain control?
Secondly, it was Novacyt giving shares to Lab21. Usually it is the buyer that gives shares/cash to the seller.
This combination of companies doesn't seem to tick the reverse takeover boxes either.
I know you don't like Google but you really need to start using it. You'll learn loads before embarrassing yourself on here.
Lab21 acquisition - put to bed
Lab 21 closure - put to bed
Me - going to bed"
Naw, that wasn't my theory, I wouldn't post anything so dictatorial, arrogant, rude, wrong and stupid. That was someone else.
Sat 01:48 ?
just scanned the thread another few times, still can't find me saying anything like that. Although I have now realised what a thoroughly nasty individual you are in how you speak to people. Very snidey, very childish.
Not sure I said that, because that would be totally wrong 100% wrong.
I scanned the thread 4 times and can't see where I ever said that, can you point it out to me.
BH, that was my point. Dev aquiring a private company yet FCA calling it a reverse takeover.
I made the point purely because you are hanging all of your theory on a reverse takeover can only mean a private company buying a listed company. The Dev Clever example shows that is not the case therefore your theory has fallen apart. There are many more examples available.
The AIM document also refers to it as Novacyt acquiring Lab21. Why do you dismiss this? Can you explain why they would term it as Novacyt acquires Lab21?
Yeah. Know doubt DA is a looser.
Tata md ceo , promoting express PCR , aka mygo pro/q 16 on linked in .
https://www.linkedin.com/feed/update/urn:li:ugcPost:6968100454513745920?utm_source=linkedin_share&utm_medium=member_ios_link_share&utm_content=post