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May22
Devin's Definitions: Reverse Triangular Merger
j0387695.jpgReverse Triangular Merger:  Not to be confused with a "reverse merger" a reverse triangular merger refers to a transaction in which the acquiring company forms a subsidiary for the special purpose of merging with the target company.  By virtue of the merger, the target becomes a subsidiary of the acquiror and shareholders of the target receive shares in the acquiring company.

This is a common structure for mergers, especially where it makes sense for the acquired company to be operated as a subsidiary of the acquiror rather than be merged with it.

You may wish to check out the Investopedia definition.

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