An offering prospectus is a formal legal document that is required by and filed with the relevant government financial securities regulator, such as Gibraltar Financial Services Commission and provides details about an investment offering for sale to qualified institutional investors or to the public at large, known as retail investors. There are typically two types of prospectus; (i) the preliminary prospectus, often referred to as “red herring”, “draft red herring” or “draft red herring prospectus” (DRHP) and (ii) the Final Prospectus, also referred to as Statutory Prospectus aka Offering Circular.
Prospectus.com expert staff conducts the initial analysis of your company.
Some of the most common interchangeable terms in the offering document space is the usage of the word “prospectus” for both private and public offerings. Which is correct? Traditionally speaking, the term prospectus is most often associated with a public offering or listing on a stock exchange. A company going through the stages of an initial public offering must create a prospectus. However, in the private placement world, it has also become common to use the term prospectus, even though the most appropriate term would be “private placement memorandum”, “PPM”, or even “offering memorandum”. Even within this narrow field, the offering memorandum or private placement memorandum (PPM) can be associated with a hedge fund or mutual fund, or a basic company raising capital. Many refer to the private placement document process by simply calling it prospectus, as worldwide this is the most common term designated for raising capital.Our team assists with public prospectus writing and offering circular documents worldwide.
There are two type of equity offerings that are most common, private and public. Equity is essentially ownership in a company. In return for capital an investor may be given equity, or a percentage of the company. Private offerings for Gibraltar based companies that issue equity do so often with a prospectus or an offering memorandum. Equity offering documents vary from country to country as they must comply with various federal and local state or province rules. We can assist with any private equity offering document or prospectus globally.
Prospectus writing for debt issuance can be complicated. Debt is essentially a company giving a piece of paper, called a “note” or a “bond” to an investor with a promise to return the investor’s capital at a certain point in time (called a maturity date), and most often an interest payment (called interest rate) at a fixed time. Interest payments vary, and Gibraltar companies issuing debt may decide to pay interest, for example, monthly, bi-annually or yearly, or even at maturity. A prospectus is needed for issuing debt, this way an investor can make an educated decision about investing. Regarding the difference between issuing notes and bonds, this depends mainly on the length of the debt. Traditionally a note is under 10 years, while a bond may exceed 10 years in length. In addition, many companies will issue convertible bonds or convertible notes. In such convertible debt, the notes or bonds will “convert” to equity at a given time, essentially making the note holder or bond holder an owner.