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Chapter 23

1.2 Reasons

Reasons for group reorganisations include:

 A group may wish to list on a public stock exchange. This is usually facilitated
by creating a new holding company and keeping the business of the group in
subsidiary entities.

 The group may split into two or more parts. Each part will still be owned by the
same shareholders. This is a demerger and is often done to enhance
shareholder value.

 An unlisted entity may purchase a listed entity with the aim of achieving a stock
exchange listing itself. This is called a reverse acquisition.

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