ADVOKS GLOBAL · KENYA
The Capital Markets (Public Offers, Listings and Disclosures) Regulations, 2023
17. Private offers
Edition: 2023-12-15 · In force
17. Private offers
(1)For the purposes of these Regulations, an offer of securities shall be regarded as a private offer if the offer is made to a person in Kenya under any of the following conditions—(a)the securities are offered to not more than one hundred persons who are specifically identified and the offer shall remain open for a continuous period not exceeding twelve months, and the offer shall not be repeated with wholly or partially different persons by the same entities or related parties, or ultimately for a common purpose, within a period of twenty-four months from the date of the first offer;(b)the securities are offered to the members of a club or association (whether or not incorporated) by or on behalf of that club or association, and the members can reasonably be regarded as having a common interest with each other and the club or association in its affairs and in what is to be done with the proceeds of the offer:Provided that such club or association or interest has not been established, created or designed to defeat the mandate of the Authority to oversee public offers;(c)the securities are offered in connection with a valid invitation to enter into an underwriting agreement with respect to the securities;(d)the securities are of a private company and are offered by that company to—(i)shareholders or employees of the company; or(ii)members of the families of any such shareholders or employees;(e)the securities are of an unlisted public company and are offered by that company to shareholders of the company;(f)the securities are offered to a restricted circle of persons whom the offeror reasonably believes to be sufficiently knowledgeable to understand the risks involved in accepting the offer and the number of such persons does not exceed one hundred;(g)the securities are offered to the controlling shareholders, substantial shareholders or directors of the issuer or the issuer’s parent or subsidiary companies or associates;(h)the securities result from the conversion of convertible securities in respect of which the Authority had already approved an information memorandum; or(i)the securities of a listed company are offered in connection with a take-over scheme approved by the Authority.(2)For the purposes of subregulation (1)(d)(ii), the members of a person's family include a spouse, son, adopted son, step-son, son-inlaw, daughter, adopted daughter, step-daughter, daughter-in-law, father, step-father, father-in-law, mother, step-mother, mother-in-law, brother, step-brother, brother-in-law, sister, step-sister, sister-in-law, grandchild or spouse of a grandchild of that person, and any trustee (acting in his or her capacity as such) of a trust the principal beneficiary of which is the person or any of the person’s relatives.(3)An offer made under this regulation shall be made only to a person whose name is recorded by the offeror prior to the invitation to subscribe, and that such person shall receive the offer by name, and that a complete record of any such offerees shall be kept by the company and submitted to the Authority on demand.(4)The Authority may require the issuer in a private offer to submit a list of the targeted investors.(5)An issuer offering securities under this regulation shall not issue any public advertisements or utilize any media, marketing or distribution channels or agents to inform the public, or capable of informing the public, about such an offer.(6)An offer or invitation which does not comply with the provisions of this Part shall be a public offer, or a restricted public offer, as the case may be, and the provisions of these Regulations relating to public offers or restricted public offers shall apply to that offer or invitation.