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Are you planning to take your private company public through a Reverse Merger in India? Enterslice provides end-to-end legal, regulatory, and compliance support to help you achieve a seamless, compliant transition.
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Legal Protection Benefits Types Approval Process Statutory Provisions SEBI (ICDR Regulations) Regulations Reverse Merger Vs IPO Why Trust Enterslice FAQs Schedule Meeting Understanding Reverse Merger in India Are you thinking of taking your private company public without the long IPO wait? A reverse merger in India could be an ideal route for you. Engaging experienced professionals is highly recommended to ensure a smooth and compliant process. At Enterslice, we provide end-to-end services related to Reverse Merger in India, helping businesses understand how to go public through reverse merger in India. A reverse merger is often an effective structure for M&A transactions involving publicly listed companies. In this process, a listed company merges with an unlisted company, resulting in a combined entity that remains publicly listed. This approach allows private companies to gain public status without undergoing a traditional IPO. With the changing global order and ongoing economic uncertainties since the pandemic, corporations worldwide have increasingly adopted unconventional and idiosyncratic corporate restructuring scenarios for strategic and operational reasons. Unlike traditional methods of corporate restructuring, a Private Limited Company may acquire a Public Limited Company, a Subsidiary Company may take over its Holding Company, or a company with a smaller share capital may acquire one with a larger share capital. A reverse merger offers several advantages, including economies of scale, cost reduction, entry into new markets, business diversification, and an increase in market share. Schedule a 30-min strategy call with our CAs, CS, and consultants. Faster Cross-border Mergers Gharwapsi Trend for Tech Firms Around 126 Total Unicorns in India India’s M&A Market (Double to Over USD 50 Billion by 2030) 190+ Firms Eye IPOs in India in 2026 India’s M&A Market (9.2% CAGR b/w 2025-31) Go Public Faster with a Reverse Merger in India Take your private company to the public market without the complexities of a traditional IPO. A Reverse Merger in India offers a strategic, time-efficient, and cost-effective route to listing while ensuring regulatory compliance. Avoid 80% of regulatory objections with us for a reverse merger in India. Book a 30-Min Advisory Call Legal Protection Under Sections 230-232 of the Companies Act, 2013 In general, the Companies Act, 2013, governs mergers under Section 230-232, outlining the legal framework for company approvals, creditor consents, and regulatory clearances. The Legal Protection Under Sections 230-232 of the Companies Act, 2013 is mentioned below. Section 230: When Can a Merger Be Proposed It refers to a situation when a company wishes to restructure or consolidate its business, or when the board of directors of both merging companies approve the scheme. Further, when both the creditors and shareholders agree to the proposed merger scheme. Section 231: Powers of NCLT in Merger Approval Section 231 of the Companies Act 2013 covers the power of NCLT in Merger Approval. Here, NCLT has the authority to approve, reject, or modify the merger scheme. It ensures compliance with shareholder and creditor interests. Moreover, the tribunal may impose conditions to protect public interest and competition laws. Section 232: Compliance Requirements for Mergers This section ensures that merger schemes are fair to all stakeholders, while a valuation report and an auditor's certificate must be submitted. Further, it is mandatory to obtain regulatory approvals before completing the merger. What are the Benefits of Going Public through Reverse Merger in India? The list of benefits of going public through reverse merger in India is as follows: Cheaper access to the stock market The reverse merger offers a cheaper and faster way of accessing the stock market without an investor roadshow or looking for an IPO underwriter, while simply acquiring an under-traded (and hopefully, by extension, undervalued) company. Ownership of a public company As compared to a private company, owning a public company reduces the burden of regulatory and compliance requirements. It provides faster access to liquidity, enhances the company’s market visibility and thus enables acquisitions by using shares as consideration. Also, public companies generally trade at higher valuations compared to private companies. Listing on the stock exchange One of the key advantages of a reverse merger in India is that upon completion, the shares of the merging unlisted entity are listed on a stock exchange without the traditional process of an initial public offering (IPO). Therefore, going public through a reverse merger in India bypasses the lengthy IPO procedures, reducing overall time and compliance costs. Liquidity and Exist opportunities Company listing through M&A of listed companies through reverse mergers provides liquidity to existing shareholders of the merging unlisted entity. It may also offer an exit opportunity for financial investors who hold shares in the unlisted company. Regulatory Lock-in Requirements in India As per the Indian securities laws, a lock-in restriction is imposed on shares of the unlisted company involved in a reverse merger with a listed entity. While a promoter’s shares, up to 20% of the post-merger paid-up share capital, are locked in for three years from the date of listing and for other shares of the merging unlisted entity that get listed, are locked in for one year from the date of listing. It is one of the merits of going public through reverse merger in India. What are the Types of Reverse Merger in India? Typically, reverse merger in India under Companies Act, 2013 are categorized into two types: Voluntary Mergers (Company-Initiated Process) A voluntary merger is when businesses proactively decide to merge for strategic growth, while the process for the same begins with internal approvals and legal documentation. Compulsory Mergers (Court-Mandated Process) Compulsory mergers occur when the regulatory bodies or creditors file a petition due to financial distress. Further, the NCLT (National Company Law Tribunal) oversees the merger to protect stakeholders. Know about the NCLT Merger Approval Process? The step-by-step guide for the NCLT merger approval process is as follows: Initial Consultation & Risk Assessment Firstly, the applicant company shall take professional consultations from experts in order to understand the business objectives behind the proposed merger. This professional consultation also includes evaluating potential risks and legal hurdles and advising on feasibility and compliance requirements. Legal Documentation & Filing Secondly, draft a scheme of merger with the support of necessary documents like a valuation report, an auditor’s certificate, a list of creditors, etc. After completion, file an application with the NCLT for further proceedings with the proposal of an M&A of listed companies through reverse mergers. Compliance & Negotiations In this stage, the applicant company may conduct meetings for both shareholders and creditors to secure approvals. Followed by liaising with regulatory authorities like SEBI, CCI, and ROC. Resolution & Final Actions This is the last stage, which includes representation or hearing before the NCLT if required and accordingly securing a final NCLT Approval for Mergers, followed by filing with the Registrar of Companies (ROC) and completing merger execution. Get end-to-end Reverse Merger Support covering 100% compliance. Book a 30-Min Advisory Call Statutory Provisions Governing Reverse Takeover in India (2026) The statutory provisions governing Reverse Takeover in India, 2026 are as follows: Companies Act, 2013 Section 232(h) defines the merger between a listed and unlisted company, which results in treating the entity as unlisted; it officially becomes a listed company. This restricts immediate access to capital markets through a backdoor listing. SEBI Regulations An approval from SEBI is a must for merging an unlisted company with a listed company, including a prior approval from the stock exchange for the scheme arrangement. While, the listed company must provide details about the unlisted company and the merger proposal to the shareholders. Further, Shareholders of the listed company and Qualified Institutional Buyers of the unlisted company must collectively hold at least 25% of the merged entity and only unlisted companies can merge with listed entities that are listed on nationwide trading stock exchanges. Income Tax Act, 1961 Section 72A allows the merged entity to claim accumulated losses and depreciation of a distressed company. All the assets and liabilities of the merging company must be transferred to the merged company as per the scheme. While shareholders who hold at least 90% in value of shares in the merging company must become shareholders of the merged entity. SEBI (ICDR Regulations), 2025 SEBI now requires in-depth valuation and share swap reports for reverse mergers, opening the door for transparency and curbing the misuse of shell companies. Schedule Meeting SEBI (Listing Obligations and Disclosure Requirements) Regulations This regulation was updated in 2025. These rules mandate post-merger disclosures. It is especially for reverse mergers in the IT and healthcare sectors. Reverse Merger Vs IPO in India: Key Differences Have a look at the significant breakdown of Reverse Merger Vs IPO in India- Feature Reverse Merger Initial Public Offering (IPO) Process Private company merges with a listed shell company, effectively taking control and listing Direct sale of shares to the public via a SEBI-approved prospectus (DRHP) Time Less time – just a few weeks Lengthy, time-taking journey – 3 to 6 months Capital Primarily accesses existing public market listing; may not raise huge funds initially Raises fresh capital for growth Control Private firm’s shareholders gain control of the listed entity; less dilution initially New shares issued, diluting existing ownership; management changes are common Regulatory Focus Strict SEBI rules now prevent misuse; focus on genuine benefit to the listed entity Intense SEBI scrutiny on financials, valuation, and disclosures Ideal For Companies needing quick market access, restructuring, or revival of sick listed entities Large growth-stage firms seeking significant capital infusion Trend (2026) Growing use for cost-effective restructuring and “reverse flips” into India Strong market for tech IPOs with high investor appetite Scale Revenue 10X with Reverse Merger in India Target Rs 100 Crore annual revenue faster with expert-led support at Enterslice. Save up to 60% in Listing Costs 100% Digital, No Physical Visit Required Get Started Why Trust Enterslice for Reverse Merger in India? With years of experience, Enterslice brings in-depth expertise in handling reverse merger in India, ensuring a seamless and compliant process for your company. Here’s why Enterslice should be your first choice for a reverse merger in India: Expertise in Indian corporate laws, SEBI regulations, and compliance requirements 10,000+ professionals with 15+ years of experience Proven track record in successfully completing reverse mergers for multiple companies End-to-end support from pre-merger planning to post-merger compliance Customized strategies tailored to your company’s unique requirements Transparent communication with timely updates at every stage Assistance with documentation, filings, and regulatory approvals Guidance to optimize your merger structure and protect shareholder interests Professional due diligence to identify and mitigate potential risks Support in strategic planning for a smooth transition into a listed entity Ensures full regulatory compliance and risk management throughout the merger process FAQs on Going Public through Reverse Merger in India What is a Reverse Merger in India? A reverse merger is a process where a private company becomes publicly listed by merging with a listed shell company in India, rather than going through a traditional IPO. It serves as a faster alternative to IPO in India for companies seeking access to capital markets. How is a Reverse Merger different from an IPO in India? In the Reverse Merger vs IPO in India comparison: IPO: Involves issuing new shares to the public, requiring extensive regulatory approvals and a longer timeline. Reverse Merger: A private company merges with an existing listed company, providing a faster and often more cost-effective route to become a publicly listed entity. What is a Listed Shell Company in India? A listed shell company in India is a publicly traded company that has minimal operations or assets. Private companies often merge with these entities during the reverse merger process in India to gain listing status efficiently. What is the Reverse Merger Process in India? The reverse merger process in India typically includes: Identifying a suitable listed shell company. Conducting legal and financial due diligence. Filing the merger proposal with the National Company Law Tribunal (NCLT). Obtaining approvals from SEBI and stock exchanges. Completing post-merger compliance and disclosures. Why consider a Reverse Merger as an Alternative to IPO in India? You may consider a reverse merger as an alternative to an IPO in India for the following reasons: Faster listing process compared to IPO. Lower regulatory and compliance burden. Retains promoter control while gaining access to capital markets. Useful for companies seeking visibility and growth without public fundraising. Are there lock-in requirements after a Reverse Merger? Yes, securities regulations impose a lock-in requirement after a Reverse Merger, as mentioned below: 20% of post-merger shares held by promoters are locked in for three years. Remaining shares are locked for one year after listing. Who should opt for a Reverse Merger in India? Companies that want to become publicly listed quickly, avoid the lengthy IPO route, or merge strategically with a listed shell company in India are ideal candidates. How can Enterslice help with a Reverse Merger in India? Enterslice provides comprehensive guidance on the reverse merger process in India, including legal advisory, NCLT filings, SEBI compliance, and post-merger formalities, ensuring a smooth transition as an alternative to IPO in India.
Are you thinking of taking your private company public without the long IPO wait? A reverse merger in India could be an ideal route for you. Engaging experienced professionals is highly recommended to ensure a smooth and compliant process. At Enterslice, we provide end-to-end services related to Reverse Merger in India, helping businesses understand how to go public through reverse merger in India.
A reverse merger is often an effective structure for M&A transactions involving publicly listed companies. In this process, a listed company merges with an unlisted company, resulting in a combined entity that remains publicly listed. This approach allows private companies to gain public status without undergoing a traditional IPO.
With the changing global order and ongoing economic uncertainties since the pandemic, corporations worldwide have increasingly adopted unconventional and idiosyncratic corporate restructuring scenarios for strategic and operational reasons.
Unlike traditional methods of corporate restructuring, a Private Limited Company may acquire a Public Limited Company, a Subsidiary Company may take over its Holding Company, or a company with a smaller share capital may acquire one with a larger share capital. A reverse merger offers several advantages, including economies of scale, cost reduction, entry into new markets, business diversification, and an increase in market share. Schedule a 30-min strategy call with our CAs, CS, and consultants.
Faster Cross-border Mergers
Gharwapsi Trend for Tech Firms
Around 126 Total Unicorns in India
India’s M&A Market (Double to Over USD 50 Billion by 2030)
190+ Firms Eye IPOs in India in 2026
India’s M&A Market (9.2% CAGR b/w 2025-31)
Take your private company to the public market without the complexities of a traditional IPO. A Reverse Merger in India offers a strategic, time-efficient, and cost-effective route to listing while ensuring regulatory compliance. Avoid 80% of regulatory objections with us for a reverse merger in India.
In general, the Companies Act, 2013, governs mergers under Section 230-232, outlining the legal framework for company approvals, creditor consents, and regulatory clearances. The Legal Protection Under Sections 230-232 of the Companies Act, 2013 is mentioned below.
It refers to a situation when a company wishes to restructure or consolidate its business, or when the board of directors of both merging companies approve the scheme. Further, when both the creditors and shareholders agree to the proposed merger scheme.
Section 231 of the Companies Act 2013 covers the power of NCLT in Merger Approval. Here, NCLT has the authority to approve, reject, or modify the merger scheme. It ensures compliance with shareholder and creditor interests. Moreover, the tribunal may impose conditions to protect public interest and competition laws.
This section ensures that merger schemes are fair to all stakeholders, while a valuation report and an auditor's certificate must be submitted. Further, it is mandatory to obtain regulatory approvals before completing the merger.
The list of benefits of going public through reverse merger in India is as follows:
The reverse merger offers a cheaper and faster way of accessing the stock market without an investor roadshow or looking for an IPO underwriter, while simply acquiring an under-traded (and hopefully, by extension, undervalued) company.
As compared to a private company, owning a public company reduces the burden of regulatory and compliance requirements. It provides faster access to liquidity, enhances the company’s market visibility and thus enables acquisitions by using shares as consideration. Also, public companies generally trade at higher valuations compared to private companies.
One of the key advantages of a reverse merger in India is that upon completion, the shares of the merging unlisted entity are listed on a stock exchange without the traditional process of an initial public offering (IPO). Therefore, going public through a reverse merger in India bypasses the lengthy IPO procedures, reducing overall time and compliance costs.
Company listing through M&A of listed companies through reverse mergers provides liquidity to existing shareholders of the merging unlisted entity. It may also offer an exit opportunity for financial investors who hold shares in the unlisted company.
As per the Indian securities laws, a lock-in restriction is imposed on shares of the unlisted company involved in a reverse merger with a listed entity. While a promoter’s shares, up to 20% of the post-merger paid-up share capital, are locked in for three years from the date of listing and for other shares of the merging unlisted entity that get listed, are locked in for one year from the date of listing. It is one of the merits of going public through reverse merger in India.
Typically, reverse merger in India under Companies Act, 2013 are categorized into two types:
A voluntary merger is when businesses proactively decide to merge for strategic growth, while the process for the same begins with internal approvals and legal documentation.
Compulsory mergers occur when the regulatory bodies or creditors file a petition due to financial distress. Further, the NCLT (National Company Law Tribunal) oversees the merger to protect stakeholders.
The step-by-step guide for the NCLT merger approval process is as follows:
Firstly, the applicant company shall take professional consultations from experts in order to understand the business objectives behind the proposed merger. This professional consultation also includes evaluating potential risks and legal hurdles and advising on feasibility and compliance requirements.
Secondly, draft a scheme of merger with the support of necessary documents like a valuation report, an auditor’s certificate, a list of creditors, etc. After completion, file an application with the NCLT for further proceedings with the proposal of an M&A of listed companies through reverse mergers.
In this stage, the applicant company may conduct meetings for both shareholders and creditors to secure approvals. Followed by liaising with regulatory authorities like SEBI, CCI, and ROC.
This is the last stage, which includes representation or hearing before the NCLT if required and accordingly securing a final NCLT Approval for Mergers, followed by filing with the Registrar of Companies (ROC) and completing merger execution.
Get end-to-end Reverse Merger Support covering 100% compliance.
The statutory provisions governing Reverse Takeover in India, 2026 are as follows:
Section 232(h) defines the merger between a listed and unlisted company, which results in treating the entity as unlisted; it officially becomes a listed company. This restricts immediate access to capital markets through a backdoor listing.
An approval from SEBI is a must for merging an unlisted company with a listed company, including a prior approval from the stock exchange for the scheme arrangement. While, the listed company must provide details about the unlisted company and the merger proposal to the shareholders.
Further, Shareholders of the listed company and Qualified Institutional Buyers of the unlisted company must collectively hold at least 25% of the merged entity and only unlisted companies can merge with listed entities that are listed on nationwide trading stock exchanges.
Section 72A allows the merged entity to claim accumulated losses and depreciation of a distressed company. All the assets and liabilities of the merging company must be transferred to the merged company as per the scheme. While shareholders who hold at least 90% in value of shares in the merging company must become shareholders of the merged entity.
SEBI now requires in-depth valuation and share swap reports for reverse mergers, opening the door for transparency and curbing the misuse of shell companies.
This regulation was updated in 2025. These rules mandate post-merger disclosures. It is especially for reverse mergers in the IT and healthcare sectors.
Have a look at the significant breakdown of Reverse Merger Vs IPO in India-
Target Rs 100 Crore annual revenue faster with expert-led support at Enterslice.
With years of experience, Enterslice brings in-depth expertise in handling reverse merger in India, ensuring a seamless and compliant process for your company. Here’s why Enterslice should be your first choice for a reverse merger in India:
A reverse merger is a process where a private company becomes publicly listed by merging with a listed shell company in India, rather than going through a traditional IPO. It serves as a faster alternative to IPO in India for companies seeking access to capital markets.
In the Reverse Merger vs IPO in India comparison:
A listed shell company in India is a publicly traded company that has minimal operations or assets. Private companies often merge with these entities during the reverse merger process in India to gain listing status efficiently.
The reverse merger process in India typically includes:
You may consider a reverse merger as an alternative to an IPO in India for the following reasons:
Yes, securities regulations impose a lock-in requirement after a Reverse Merger, as mentioned below:
Companies that want to become publicly listed quickly, avoid the lengthy IPO route, or merge strategically with a listed shell company in India are ideal candidates.
Enterslice provides comprehensive guidance on the reverse merger process in India, including legal advisory, NCLT filings, SEBI compliance, and post-merger formalities, ensuring a smooth transition as an alternative to IPO in India.
Red Herring Top 100 Asia enlists outstanding entrepreneurs and promising companies. It selects the award winners from approximately 2000 privately financed companies each year in the Asia. Since 1996, Red Herring has kept tabs on these up-and-comers. Red Herring editors were among the first to recognize that companies such as Google, Facebook, Kakao, Alibaba, Twitter, Rakuten, Salesforce.com, Xiaomi and YouTube would change the way we live and work.
Researchers have found out that organization using new technologies in their accounting and tax have better productivity as compared to those using the traditional methods. Complying with the recent technological trends in the accounting industry, Enterslice was formed to focus on the emerging start up companies and bring innovation in their traditional Chartered Accountants & Legal profession services, disrupt traditional Chartered Accountants practice mechanism & Lawyers.
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