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Summary posted by Carol Sylvester on April 3, 2002.

Here is the summary of answers to my request for information on where to find shell companies available for sale.

The most recommended source was the website www.reversemerger.com

Other websites recommended for information were the following:

http://www.lakewayinternational.com/choosing.html
http://www.scoutcapital.com/core.htm

I also found many sites selling shell companies just by searching on "shell companies" and variations on that phrase.

Two other list members sent me some other information I feel I should share...

This is an interesting question.

1. Major corporations often create "shell" companies with a P&L to have on the ready should they need a vehicle to go public since there needs to be a 3 year P&L before going public. Others create "shell" companies for financial reasons, i.e. last I heard Enron had 800+ of these. You should be able to find these in their 10-K under subsidiaries.

2. Joint ventures often, not always, have a P&L, but no employees, since all the employees stay on the partners' payrolls.

3. A few publicly listed companies have no employees, so they may be holding companies or joint ventures.

4. Visit www.marketguide.com and select "screening tools." Choose "employees = 0." You will find that of the 9,327 listed companies in their database, 282 have no employees. Click on that "282" and you get a list of the companies.

Note, the term "reverse mergers" refers to the transaction where the shell company is bought by a private company with operations and ceases to be a shell. So technically, the shell companies are reverse merger candidates. This is not the same thing as shell companies created by larger companies for the vague purposes discussed. Often they are companies who had operations which didn't work out. Rather than fold, they hang out hoping for a reverse merger.

The phrases I have seen in the 10K business description include:

• no current operations
• no current business activities
• ceased operations
• discontinued all operating activities

You could look at some reverse mergers examples (you can search the Synopsis field on SDC or a press release search will work) and look at the 10K's of those companies before the reverse merger to see some examples of the descriptions.

Also, they are usually on the OTCBB.

Created on April 4, 2002