The prospectus and documentation

The role of the prospectus

In a public offering, investors cannot negotiate individually with the company and cannot carry out their own due diligence. The prospectus resolves this information asymmetry: it makes the information needed for an informed investment decision available to everyone, at the same time and in the same form.

The prospectus also protects the company: complete and balanced disclosure reduces the risk of later claims. Conversely, omissions or misleading statements can give rise to liability for the issuer and the persons responsible for the document.

What a prospectus contains

The exact structure is set by the applicable regulations, but most prospectuses follow a similar logic, starting with an accessible summary and moving on to legal and financial details.

Risk factors: candor and specificity

The risk section is not a formality. An informed investor knows that every business has risks; they want to learn which ones are specific to this company and how much they could affect results. Generic risks that apply to any firm say too little.

• Operational risks: dependence on one customer, supplier or key person.
• Financial risks: indebtedness, currency exposure, interest rate changes, liquidity.
• Market and regulatory risks: competition, legislative changes, licenses.
• Risks related to the securities: low trading liquidity, price volatility, control exercised by the majority shareholder.

Prospectus approval and related documentation

1. Due diligence and draftingThe advisers verify the information about the company, and the team drafts the prospectus based on the documents and the audited financial statements.
2. Internal approvalsThe company's competent bodies (for example, the general meeting or the board, as applicable) adopt the decisions on the issue and the offering.
3. Filing with the supervisory authorityThe prospectus and accompanying documents are filed with the CNPF for review.
4. Comments and additionsThe authority may request clarifications or changes; the team responds and revises the document.
5. Approval and publicationAfter approval, the prospectus is published in the form and through the channels required by the regulations, before the offering begins.
6. Application for admission to the exchangeTo trade on BIMx, the company submits the application and the documents required by the exchange rules, described in "Regulations and legal acts" and on the "Listing process" page.

If, after approval and before the offering closes, significant new facts arise or material errors are discovered, the regulations usually require the information to be updated through supplementary documents. Marketing materials must be consistent with the prospectus and must not present information more optimistically than it does.