The JOBS Act loosens restrictions around capital raises, lessens both U.S. IPO and ongoing disclosure and other obligations for many issuers, including foreign issuers, and reduces the cost of being public in the United States. For those OTCQX International issuers, prospective issuers and other members of the OTCQX International community who are wondering what impact the JOBS Act will have on them, here is an article from Michael Littenberg and James Nicoll of Schulte Roth & Zabel which provides an overview of those portions of the JOBS Act of particular relevance to OTCQX International issuers. Here is an excerpt:
The most immediate benefit of the JOBS Act for most OTCQX International issuers will be the elimination of restrictions on general solicitations and general advertising in connection with most U.S. private placements. OTCQX International issuers typically are exempt from U.S. reporting pursuant to the U.S. Securities and Exchange Commission’s Rule 12g3-2(b) exemption. Because this exemption is not available to foreign issuers that publicly raise capital in the United States, OTCQX International issuers that raise capital in the United States typically do so through private placements. Under current U.S. law, issuers and intermediaries are severely limited in their ability to promote a private placement. Among other things, they cannot engage in print, Internet or broadcast advertising and are limited in their ability to engage in other activities that may condition the market for the securities being offered, such as press releases, press conferences and interviews. (more…)
I’ve just received a copy of the Schulte Roth & Zabel Private Equity Buyer/Public Target M&A Deal Study 2011 Year-End Review. It discusses the notable trends and themes in mergers and acquisitions involving private equity buyers and public company targets. The Year-End Review examines the transactional landscape in 2011 and analyzes in depth the key deal terms in all private equity buyer/public company target cash merger transactions involving consideration of at least $500 million in enterprise value entered into during 2010 and 2011. The Year-End Review also addresses additional topics, including market activity, deal process and timing, a comparative study of 2011 deal terms versus 2010 deal terms and other selected deal analyses.
Some key observations from the study:
As widely reported, 2011 was a tumultuous year characterized by economic uncertainty. The European sovereign debt crisis and the downgrade to the U.S. credit rating caused significant volatility in the U.S. debt and equity markets. The large private equity buyer/public company segment of the U.S. M&A market was not immune to these factors. Deal activity was down overall relative to 2010 and the deals that were completed in 2011 took longer to complete. (more…)
Schulte Roth & Zabel posted an alert last week that on March 22, 2012, legislation was introduced in the Senate proposing to delay the effective date of the Volcker Rule by one year. The delay would provide regulators with extra time to work through the thousands of comment letters it has received.
Here is an excerpt from the Schulte Roth & Zabel Alert:
Today, a bipartisan group of senators introduced legislation that would delay the effective date of the Volcker Rule, which is currently scheduled to occur on July 21, 2012, until 12 months after the federal financial regulators issue their final rule implementing the statutory provision. The Volcker Rule is part of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) and restricts the proprietary trading and private investment fund activities of U.S. banks and bank affiliates, as well as foreign banks with banking operations in the United States and their affiliates.
See the full alert here.