What should a sponsor do if they want to issue new shares in a reverse takeover?

In the context of a reverse takeover, a sponsor should seek shareholder approval before issuing new shares. A reverse takeover occurs when a private company acquires a publicly traded company, often to bypass the lengthy and complex process of going public.

When new shares are issued, especially in a context that can significantly alter the existing shareholder structure or dilute the ownership of current shareholders, it's crucial to obtain their consent. Seeking shareholder approval is not only a legal requirement in many jurisdictions, but it also aligns with the principles of corporate governance and transparency. It ensures that shareholders are informed about potential changes that could affect their investment and gives them a say in significant corporate actions.

The other options do not directly address the necessary steps for issuing new shares in a reverse takeover. Filing a complaint would pertain to grievances rather than facilitating a corporate action, conducting a market survey does not relate directly to the approval process for issuing shares, and preparing a risk assessment, while useful for understanding potential downsides, does not substitute for obtaining shareholder consent. Seeking approval from shareholders ensures proper governance and adherence to regulatory requirements during such significant changes.