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LAVCA in the News

Regulatory Change in Brazil May Open Up New Way for PE-Backed Companies to Raise Capital

10 November 2014

(DowJones) Recent regulatory changes in Brazil that allow companies to sell shares to qualified buyers without having to register for a public offering could make it easier for private equity-backed companies to raise capital and attract new investors, experts and regulators say.

Comissão de Valores Mobiliários, the Brazilian regulatory equivalent to the U.S. Securities and Exchange Commission , recently amended its rule known as Instruction 476. Inspired by SEC Rule 144A, which allows for the public resale of restricted and control securities as long as certain conditions are met, Instruction 476 regulates Brazilian public offerings distributed with so-called restricted efforts. These securities can only be sold to up to 50 qualified investors such as banks, investment firms and mutual funds.