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Over its history, HFG has completed reverse merger transactions across a broad spectrum of industries and sectors. We do not focus on specific industries, but rather on high growth, well managed and profitable companies.
We believe a company must meet certain financial requirements to be a viable reverse merger candidate. In our opinion, a company must be able to achieve a minimum $30 million market valuation, based upon historical financial performance relative to its publicly traded peer group. Depending on the industry and any unique factors, this typically would equate to approximately $1.5 million to $2 million in historical, after-tax profit based on a P/E of 15 to 20 times earnings.
In certain cases, HFG would consider candidates that fall below our profitability threshold, if there is justification and evidence that the company's public valuation would exceed the abovementioned market capitalization requirement.
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