ADVOKS GLOBAL · KENYA
The Capital Markets (Securities) (Public Offers, Listing and Disclosures) Regulations
6. Issuer to publish prospectus
Edition: 2022-12-31 · In force
6. Issuer to publish prospectus
(1)When securities are to be offered to the public or a section of the public in Kenya the issuer shall publish an Information Memorandum by making it available to the public or the section of the public, free of charge at an address in Kenya, during the offer period or for such period prior to Listing as prescribed by the Authority.(2)The issuer shall, before the time of publication of the information memorandum, obtain approval of the Authority that the information memorandum complies with these Regulations and shall deliver a copy thereof to the Registrar for registration.(3)With respect to initial offers to the public, the prospectus shall include—(a)an accountant's report confirming compliance by the issuer of the financial disclosures prescribed under regulation 10(1); and(b)a legal opinion which shall include but not be limited to the following—(i)whether all licences and consents required to perform the business or proposed business of the issuer have been duly obtained;(ii)the validity of evidence of ownership of land, plant and equipment and other important and relevant assets of the issuer;(iii)any agreements or contracts with respect to the proposed issue of securities, including, where applicable but not limited to, underwriting contracts, agreements or contracts with any securities exchange, registrar and trustees of bonds, debentures or other credit securities;(iv)any material litigation, prosecution or other civil or criminal legal action in which the issuer or any of its director is involved;(v)whether the existing capital of the issuer and any proposed changes thereto is in conformity with applicable laws and has received all necessary authorizations; and(vi)any other material items with regard to the legal status of the issuer and the proposed issue,Provided that where by reasons of exceptional circumstances acceptable to the Authority and disclosed in the prospectus, the issuer is not able to obtain a legal opinion, the directors of the issuer will be required individually and severally to declare and give an undertaking on the matters stated in regulation 6(3)(b)(i) to (vi), and such declaration and undertaking shall be included in the prospectus.(4)The prospectus shall be published in the English language and shall be in black and white except for the issuer's logo.(5)No person shall offer any securities to the public through an electronic form, unless on the basis of a prospectus approved by the Authority.(6)Any person offering securities through an electronic form which has been approved by the Authority shall state in the prospectus whether the application for subscription of such securities may be made in an electronic form and in that regard, the procedure and process of facilitating subscription and payment shall be disclosed in the prospectus.(7)An issuer may distribute a prospectus to prospective investors through electronic form provided such prospectus shall be in the form and content as approved by the Authority.(8)Where securities are offered through an electronic form the results of the subscription including the allocation process shall be posted on the issuer's website which shall disclose the broad classification of the allottees into individuals, local institutional investors and foreign investors.(9)Allotment of securities offered to the public shall be made on the basis of the allotment policy disclosed in the prospectus unless the results of the subscription make such policy impractical and in such a case an amendment of the allotment policy shall be made with the approval of the Authority:Provided where such amendment has been approved by the Authority the issuer shall announce the fact within twenty four hours of the grant of approval.(9A)When developing an allocation policy, an issuer or offeror shall ensure that the policy reserves at least forty per centum of the ordinary shares that are subject to an initial public offering and subsequent listing for investment by local investors.(9B)Where the per centum reserved for local investors is not fully subscribed for by local investors, the issuer or offeror may, with the prior written approval of the Authority allocate the shares remaining to foreign investors.(10)No person shall publish the results of the allotment of the public offer without notifying the Authority of the results at least twenty four hours prior to the date on which the allotment results are to be released to the public.