Select investors with compatible goals and interests
In a private placement, companies raise capital by selling shares privately to venture capital companies, private equity companies, institutional investors and others. This technique is generally considered to be less expensive, less time-consuming and more flexible than public offerings, and it also avoids legal and regulatory complications. On the other hand, companies could be forced to sell their securities below their market value to compensate investors for the greater risk they are assuming and the lack of liquidity, given that there is no secondary market.
BNP Paribas Fortis advises companies on the valuation, structuring and timing of the transaction, and on all relevant documentation, including the memorandum (equivalent of the prospectus in a public offering). Our most important role, however, is to approach potential investors. We have developed strong relationships with top-tier investors in the European investment community. We understand their portfolio profiles and investment strategies, and are thus able to approach them effectively and selectively, resulting in the swift execution of private placements.