1. The IPM and its transactions
The IPM is addressed to professionals only. Considered professionals are, on the one hand, all financial intermediaries, subject to the laws of one of the countries of the European Union, who are active in the financing of non-listed companies and, on the other hand, institutional investors such as, e.g., insurance companies, collective investment funds, holding companies.
Any type of security can be offered for sale on the IPM, insofar as it is issued by a non-listed company. They may be in the form of shares, bonds, convertible bonds, etc. The securities can already exist (secondary market) or be newly issued (primary market).
A company wishing to offer its securities (the "Issuer") on the IPM should go to a seller, member of the IPM. All financial intermediaries and institutional investors, as listed above, may act as sellers.
The seller can not directly offer the securities for sale, however. It must go through an Intermediary-Sponsor. Any member of the IPM can act as sponsor. Such sponsor is ethically - but not legally - liable for the presentation of the Issuer and its securities and thus should be independent from the seller. He should co-operate with the seller to draw up a "descriptive memorandum". Such memorandum provides a list of information regarding the Issuer, e.g. :
- name;
- type of security;
- number of offered securities and percentage thereof in comparison to the total number of securities;
- a description of the activities of the Issuer;
- financial information such as turnover, cash flow, net result over the last two accounting years, etc.;
- shareholders' structure;
- name of the sponsor.
The offered securities can be purchased by any member of the IPM, acting either on its own behalf or for third parties. The seller can freely transfer the securities, but undertakes not to trade them in the framework of a public offering within the meaning of the Royal Decree of January 9, 1991 without the prior written authorization of the issuing company.
The sales procedure itself is rather straightforward. Ten days before any session, a bulletin is circulated among the members, describing amongst other things the securities which are offered for sale, the transactions of the previous session (if the parties to such transaction agreed thereto), etc.
Yearly, five sessions are planned at the Brussels Stock Exchange: February, April, June, October and December. The idea is to have each session divided into three parts: a presentation of the Issuers and the securities offered; individual meetings between potential investors and sellers; transactions of the securities. The delivery of the securities can take place either at the Stock Exchange or elsewhere.
2. Organization of the IPM
The IPM is organized as a non-profit "de facto" association. To participate, one should become either member or member-shareholder. Permitted as members are all financial intermediaries of the European Union and institutional investors. A member pays an annual contribution of BEF 5,000. Member-shareholders should belong to one of the above categories and have been active on the IPM during the preceding year. Their contribution amounts to BEF 10,000.
All member-shareholders together form the shareholders' meeting. The IPM is managed by two organs: the counsel and the manager. The counsel decides upon the acceptance of the member-shareholders and suspends or strikes out members from the IPM. The counsel is evenly composed of financial intermediaries (two to four delegates), institutional investors (two to four delegates) and delegates from the Brussels Stock Exchange (two delegates only). The manager is the Brussels Stock Exchange. It organizes the sessions and publishes the bulletin. Furthermore, it registers the transactions and is responsible for the day-to-day management of the market.
3. Appraisal
The IPM was designed to provide a trade platform for securities of non-listed companies. It was directed especially towards companies which were starting up or looking to expand, but which were not (yet) ready for introduction on the Stock Exchange. To that effect, it was organized on an informal basis, with a minimum threshold both with regard to formalities and costs. The structure itself is flexible and simple. The link with the Brussels Stock Exchange will moreover provide the necessary know-how and will facilitate the step towards listing.
The content of this article is intended to provide general information on the subject matter. It is not a substitute for specialist advice.
De Bandt, van Hecke & Lagae - Brussels (32-2) 501 94 11
