Singaporean startup DropMySite to go public in Australia through backdoor listing

Photo credit: Corey Leopold

Singapore-based cloud backup company DropMySite is in the middle of a reverse takeover deal with Australia’s Excalibur Mining Corporation, according to an article by Business News. The deal, the details of which are undisclosed, is currently undergoing due diligence.

A reverse takeover, or backdoor listing, allows a privately held company to go public without the lengthy and arduous process of an initial public offering. Normally, the private company’s shareholders take over the public company by acquiring the majority of its shares and taking control of its board of directors.

For the deal to go through, 85 percent of DropMySite’s shareholders must be in favor, Excalibur must have approval from its own shareholders, and the companies must comply with chapters 1 and 2 of ASX’s listing rules – specifically, the requirements for listing and quotation of securities.

While it’s considered an easier way to go public, a backdoor listing can have unfortunate consequences for a privately held company if its leadership isn’t used to navigating the public trade waters. DropMySite shouldn’t have that problem, as current CEO Charif El-Ansari has over 10 years of experience in senior positions at Dell and Google.

DropMySite’s services include website, email, and Android phone backup. Its tech is available in over 100 countries. It raised an undisclosed amount of seed funding from 500 Startups in 2013.

Excalibur’s share price today shot up 150 percent after the announcement.

Source: Business News