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Publicly Traded Companies Newsletter No. 01 – January 2023
February 8th, 2023
The Publicly Traded Companies Newsletter aims to provide information on the main media news, trends, cases and legislation concerning Traded Companies matters, in Brazil and abroad. This material is for informational purposes and should not be used for decision making. Specific legal advice can be provided by our lawyers.
OFFICIAL LETTERS
CVM publishes instruction on request for automatic registration of offerings
On December 30, 2022, the CVM Superintendence of Securities Registration (“SRE”) published CVM/SRE Circular Letter 3/2022. The Official Letter introduced guidelines for intermediary institutions regarding the procedures to be followed in the new request for automatic registration of public offerings of securities, resulting from Brazilian Securities and Exchange Commission (“CVM”) Resolution No. 160, of July 13, 2022, as amended (“CVM Resolution 160”).
With the new CVM Resolution 160 in force, the procedures for automatic waiver of registration, previously provided for in CVM Instruction 476, will no longer be applicable and the SRE System. CVM will replace the former public offering registration system.
CVM clarifies doubts about the Offering Registration System
After the new Offering Registration System initiated its operations, the CVM Superintendence of Securities Registration (“SRE”) published CVM/SRE Circular Letter 1/2023 and CVM/SRE Circular Letter 2/2023 to clarify doubts regarding the new system operation and to provide complementary information to those disclosed in CVM/SRE Circular Letter 3/2022.
In CVM/SRE Circular Letter 1/2023, CVM reinforces, among other matters, that public offerings carried out under the automatic registration model must be submitted for registration in the system before the search for investors is initiated. As a result, carrying out a registration after effectively initiating the search for investors is considered an irregular practice.
In CVM/SRE Circular Letter 2/2023, CVM provides clarifications on filling out forms, submitting documentation, contacts, public offering commencement and closing milestones, compliance with bookbuilding requirements and about the new document called the “Monthly Distribution Summary”.
READ THE SUPLLEMENTARY ARTICLE IN FULL
ACCESS CVM/SRE OFFICIAL LETTER 1/2023
ACCESS CVM/SRE OFFICIAL LETTER 2/2023
SCHEDULE
CVM provides 2023 schedule with deadlines for submission of information by regulated companies
CVM released the 2023 schedule containing the deadlines for submitting information subject to punitive fine, by market participants regulated by CVM, in accordance with article 3 of CVM Resolution No. 47, of August 31, 2021, as amended.
Participants who do not disclose the mandatory information within the established deadlines will be subject to the application of daily fines by CVM, and each regulated group must observe its specific schedule.
READ THE CVM ARTICLE IN FULL
NOTE
CVM creates task force to investigate possible violations by Americanas and other potentially liable parties
On January 12 and 19, 2023 CVM reported the creation of a task force with several of its Superintendences, including the Superintendence of Company Relations (“SEP”), Superintendence of Market and Intermediary Relations (“SMI”), Superintendence of Accounting and Auditing Rules (“SNC”), Superintendence of Sanctioning Proceedings (“SPS”), Superintendence for Investor Protection and Guidance (“SOI”), Superintendence of Securities Registration (“SRE”) and Superintendence of Securitization (“SSE”).
This task force fostered, among other actions, the establishment of administrative procedures for analysis, assessment and investigation, within the sphere of CVM competence, such as:
(i) CVM Administrative Proceeding No. 19957.000413/2023-18: initiated on January 12, 2023, by the Superintendence of Company Relations of the CVM, to investigate any irregularities involving accounting information.
(ii) CVM Administrative Proceeding No. 19957.000415/2023-15: initiated on January 12, 2023, by the Superintendence of Company Relations of the CVM, to investigate any irregularities related to the disclosure of news, material facts and statements.
(iii) CVM Administrative Proceeding No. 19957.000425/2023-42: initiated on January 12,2023, by the Superintendence of Market and Intermediary Relations, to investigate any irregularities involving negotiations with assets issued by the company.
(iv) CVM Administrative Proceeding No. 19957.000452/2023-15: initiated on January 13, 2023 by the Superintendence for Investor Protection and Guidance of the CVM, to investigate a complaint received through the Autonomous Body’s service channels.
(v) CVM Administrative Proceeding No. 19957.000491/2023-12: initiated on January 16, 2023, by the Superintendence of Company Relations of the CVM, to analyze the actions of the company, main shareholders and managers, regarding compliance with CVM Resolutions 44 and 80, as well as of Law No. 6,404/76, in relation to the disclosure of a request for prior provisional remedy and the information contained in such request, in view of the information disclosed, until then, on accounting inconsistencies reported through the Material Fact of January 11, 2023, as well as regarding the Company’s decision to file a request for court-supervised reorganization with credits estimated at BRL 43 billion.
(vi) CVM Administrative Proceeding No. 19957.000530/2023-81: initiated on January 16, 2023, by the Superintendence of Securities Registration, to address the roles of intermediaries as lead coordinators in public offerings for the distribution of securities issued by the company.
(vii) CVM Administrative Proceeding No. 19957.000546/2023-94: initiated on January 17, 2023, by the Superintendence of Securitization Oversight to assess the performance of credit risk rating agencies within the scope of issuances with Americanas S.A. as debtor or co-obligator, in accordance with the provisions of CVM Resolution 9.
Following the investigation and analysis of facts and events, in the event that they are formally characterized as illegal and/or infractions, each party can be held liable to the fullest extent of the law, as applicable.
In addition, CVM filed two Administrative Inquiries to analyze the case:
(i) CVM Administrative Inquiry No. 19957.000946/2023-08: filed on January 27, 2023, to investigate possible use of privileged information and insider trading. This inquiry is a result of CVM Administrative Proceeding No. 19957.000425/2023-42, initiated on January 12, 2023, by the Superintendence of Market and Intermediary Relations, to investigate possible irregularities related to negotiations with securities issued by the company.
(ii) CVM Administrative Inquiry No. 19957.000952/2023-57: filed on January 27, 2023, to investigate any irregularities related to accounting inconsistencies reported by Americanas S.A., in the Material Fact published on January 11, 2023. This inquiry is a result of CVM Administrative Proceeding No. 19957.000413/2023-18, initiated on January 12, 2023, by the Superintendence of Company Relations, to investigate any irregularities involving accounting information.
The filing of these Administrative Inquiries does not imply changes in the course of other administrative procedures opened by CVM in relation to Americanas S.A.
READ THE CVM STATEMENT IN FULL
READ THE SUPPLEMENTARY STATEMENT IN FULL
READ THE STATEMENT ON THE INQUIRIES IN FULL
STANDARDIZATION
CVM publishes Resolution involving publicly traded companies registered in category B
CVM published CVM Resolution 885, which grants the Superintendence of Company Relations (“SEP”) the authority to analyze requests for waiver of requirements for cancellation of registration as a publicly traded company, in category B.
READ THE CVM ARTICLE IN FULL
SANCTIONING PROCEEDINGS
CVM resumes analysis of proposed Settlement Agreement with GOL executives
The CVM Collegiate Board analyzed the proposes of Settlement Agreements to terminate the CVM Sanctioning Administrative Proceeding (“PAS”) 19957.005572/2019-22, proposed by:
- Henrique Constantino, controlling shareholder and former vice-president of the Board of Directors; and
- Paulo Sérgio Kakinoff, in the capacity of president of Gol Linhas Aéreas Inteligentes S.A. (“GOL”).
The proceeding investigates news reported by the press regarding alleged improper payments made by GOL, directly or indirectly, to public agents.
Henrique Constantino is under investigation for alleged misuse of power and submitted a proposal – rejected by the majority of the Collegiate Board – to pay GOL the amount of BRL 4,914,857.50, adjusted by the IPCA index, and pay CVM the amount of BRL 1,050,000.00, as compensation for diffuse damages.
In turn, Paulo Sérgio Kakinoff is under investigation for, allegedly not having acted with the due diligence required for the position, in discussions that resulted in contracting and payments. Kakinoff proposed to pay CVM the amount of BRL 350,000.00. Such proposal was unanimously accepted by the Collegiate Board and by the Settlement Agreement Committee (“CTC”).
READ THE CVM ARTICLE IN FULL
B3
Variable income assets market moves BRL 7.46 trillion on B3 in 2022
On January 05, 2023, B3 announced that, in 2022, BRL 7.46 trillion in trades were registered in relation to variable income assets, including spot, forward and options markets.
Options trading in 2022, of BRL 205.97 billion, was above what was registered in the previous three years. Spot and forward markets recorded lower volumes than in 2021, at BRL 7.21 trillion and BRL 42.15 billion, respectively.
The months of March and November 2022 registered the higher number of transactions, with BRL 711.99 billion and BRL 706.95 billion traded, while July was the month with the lowest number of transactions, with BRL 455.18 billion.
In turn, the number of trades broke a record, at BRL 931.78 million, which represents an increase of 0.6% compared to 2021, 10.4% compared to 2020 and 136% compared to 2019.
The average amount traded per day was BRL 29.84 billion, while the average number of trades per day was 3.97 million.
“The data shows the strength of the variable income assets in 2022. The registered numbers were above the ones from 2019 and 2020 and close to the previous year, although 2021 registered 46 initial public offerings, which alone, moved BRL 65.6 billion. In 2022, the secondary market was very active, which means more liquidity for investors”, says Thiago Ferraz, trading superintendent at B3.
Complete data is available in the Market Data spreadsheet. This file is updated daily on the B3 website.
READ THE B3 ARTICLE IN FULL
B3 excludes Americanas from its indexes
On January 19, 2023, in view of the request for court-supervised reorganization, filed by Americanas, B3 excluded the company’s shares, traded under the AMER3 ticket, from all its indexes. This decision is provided for in the B3 Index Definitions and Procedures Manual, on page 8, under the heading “Companies in a special situation”.
After the trading session was closed, on January 20, 2023, AMER3 shares were withdrawn from the portfolio of the following indexes: IBOV, IGCX, ICO2, ICON, IBXX, IGCT, IGNM, IBRA, IVBX, ISEE (“ISE B3”), ITAG, SMLL, IBXL and GPTW. The shares are now listed on B3 under the heading “Court-Supervised Reorganization”.
In addition, AMER3 will now have its information published under a special segment, called “Court-Supervised Reorganization”, in the Daily Information Bulletin.
READ THE B3 ARTICLE IN FULL
Brazilian Financial and Capital Markets Association (“ANBIMA”)
ANBIMA and CVM agreement for analysis of public offerings is under reformulation
On January 02, 2023, the new update of the ANBIMA Agreement for the analysis of public offerings entered into in force. The changes aim to adjust the ANBIMA Agreement to the new regulatory framework of the Brazilian Securities Commission (“CVM”), particularly CVM Resolutions 160 and 16.
Among the main updates is the flow of analysis of documents: in line with Resolution 160, requests for offerings that is under the analysis of ANBIMA may be automatically registered by CVM.
“The main advantage is the agility, as there will be a significant time reduction in the analysis of these offerings”, says Guilherme Benaderet, Superintendent of Market Supervision at ANBIMA. The new deadlines will be from 5 to 10 business days for analysis of share issuances and up to 12 business days for fixed income securities and real estate funds.
It is important to highlight that the ordinary procedure for direct analysis at CVM varies from 20 to 33 business days and that these deadlines, both for ANBIMA and CVM, do not consider the period for institutions to make any adjustments based on what is indicated in the analyses. The manuals used by ANBIMA and the regulating body were also updated.
Another innovation is the expansion of the securities eligible for analysis by ANBIMA. As a result of the changes, the Agreement will encompass the initial public offerings (“IPOs”) of companies registered with the CVM, in addition to securities that were already contemplated, such as debentures, promissory notes, Real Estate Receivables Certificates (“CRIs”) with specific ballasts, follow-ons and real estate funds. “The idea is to advance even further over the next year, encompassing other ballast for CRIs, Agribusiness Receivables Certificates (“CRAs”), certificates of receivables from other sectors and commercial notes”, says Benaderet.
READ THE AMBIMA ARTICLE IN FULL
M&A TRANSACTIONS INVOLVING COMPANIES
CADE’s General Superintendence authorizes purchase of CSP by ArcelorMittal (“ARMT34”)
In July 2022, Vale (“VALE3”) executed, together with its partners Posco Holding Inc and Dongkuk Steel Mill Co., Ltd, a binding agreement with ArcelorMittal for the sale of their respective ownership interest in Companhia Siderúrgica do Pecém (“CSP”), considering that the closing of the transaction was subject to suspensive conditions (including the approval by the Administrative Council for Economic Defense (“CADE”)).
In early January 2023, the General Superintendence of CADE approved, without restrictions, the sale of CSP to ArcelorMittal Brasil.
READ THE VALE STATEMENT IN FULL
Oi (“OIBR3”) receives approval from CADE for the sale of SPE Torres 2 to Highline
The General Superintendence of CADE approved the sale of Lemvig RJ Infraestrutura e Redes de Telecomunicações S.A. (“SPE Torres 2”), with 8,000 fixed-line telephone towers – an asset of Oi (“OIBR3”) within its reorganization proceedings –, to NK 108 Empreendimentos e Participações S.A. – an affiliate of Highline do Brasil.
The effective conclusion of the transaction is also subject to prior consent by the Brazilian Telecommunications Agency (“ANATEL”), as well as to the fulfillment of other usual and precedent conditions for operations of this nature.
The transaction was executed in December 2022, for BRL 1.69 billion and will become effective within 15 calendar days, provided that it receives the approval of ANATEL.
READ THE OI STATEMENT IN FULL
Orizon (“ORVR3”) acquires 51% of Porto Velho S.A. and expands geographic presence to nine states
Orizon (“ORVR3”) acquired 51% of CTR Porto Velho S.A. capital. (“CTR PV”), located in the city of Porto Velho, in the state of Rondônia, through its wholly-owned subsidiary, Orizon Meio Ambiente.
As a result, Orizon established the company’s presence in the North Region of Brazil. The waste recovery company informed the market that the transaction was settled upon payment of BRL 10 million, paid in almost entirely through the receipt of shares issued by CTR PV, via payment of loan, originally granted to Ecofort Engenharia Environmental Ltda. (“Ecofort”), minority shareholder of CTR PV.
The transaction also included the following documents, among others:
(i) a debt confession amendment containing the updated outstanding balance of approximately BRL 11 million, between Orizon’s wholly-owned subsidiary, Orizon Meio Ambiente S.A. (“OMA”), and Ecofort, as well as the respective guarantee instruments; and
(ii) a shareholders’ agreement between OMA and Ecofort.
READ THE ORIZON STATEMENT OF 18 JANUARY, 2023 IN FULL
READ THE ORIZON STATEMENT OF 23 JANUARY, 2023 IN FULL
Itaú (“ITUB4”) invests in Cosan Nove, owner of Raízen shares (“RAIZ4”)
Within the context of the acquisition of ownership interest in Vale S.A. by Cosan S.A. (“Cosan”), Itaú Unibanco S.A. invested BRL 4.115 billion in Cosan Nove Participações S.A., which holds a part of the shares issued by Raízen S.A. and held by Cosan, in return for the subscription of 27% of the capital.
READ THE COSAN STATEMENT IN FULL
Priner (“PRNR3”) acquires Soegeo via controlled company Gmaia
Priner Serviços Industriais S.A. (“Priner”), acquired the entire capital stock of Soegeo Soluções em Engenharia Geotécnica Ltda. (“Soegeo”), through its controlled company Construtora Gmaia S.A.
Priner clarified that the transaction does not represent the hypothesis provided for in art. 256 of Law No. 6,404/1976 and will not allow the right of withdrawal for its shareholders.
The transaction is in line with Priner’s strategic plan to consolidate itself as the leader in maintenance engineering services in Brazil. In addition to expanding geographically and increasing the technological content of solutions offered, the M&A transactions executed by Priner Group in recent years have proven to be a value driver.
READ THE PRINER STATEMENT IN FULL
Caixa Seguridade (“CXSE3”) concludes sale of ownership interest in Holding Saúde to CNP Assurances
Caixa Seguridade Participacoes S.A. (“Caixa Seguridade”) transferred its entire ownership interest held in CNP Participações em Seguros Ltda., which holds interest in Companhia de Seguros Previdência do Sul and CNP Capitalização S.A., for the total amount of BRL 166,776,244.10, given the fulfillment of all conditions precedent and closing acts, including the approval by CADE and by the Superintendence of Private Insurance (“SUSEP”).
The transaction is in line with the strategy of Caixa Seguridade of divesting from equity interest identified as non-strategic, such as: Too Seguros S.A., Panamericano Administração e Corretagem de Seguros e de Previdência Privada Ltda., Wiz Soluções e Corretagem de Seguros S.A., Companhia de Seguros Previdência do Sul (Previsul), CNP Capitalização (former Caixa Capitalização S.A.) and CNP Consórcios (former Caixa Consórcios S.A.).
READ THE CAIXA STATEMENT IN FULL
BTG Pactual (“BPAC11”) becomes partner of Eucatex after execution of public agreement
Eucatex S.A. Indústria e Comercio S.A. (“Eucatex”) entered into a “Settlement Agreement” with the State Prosecution Office of São Paulo (“MPSP”), the Municipality of São Paulo (“Municipality”), Banco BTG Pactual S.A. (“BTG Pactual”) and others (“Settlement Agreement”), in order to:
- exclude Eucatex as defendant from a public-interest civil action and from an action for a provisional remedy;
- extinguish all constrictive and restrictive measures imposed on Eucatex, within the scope and as a result of such proceedings; and
- not file or support new claims against Eucatex for facts related to such proceedings.
Concomitantly with the execution of the Settlement Agreement, a company indirectly controlled by BTG Pactual (“Investor”) acquired the shares issued by Eucatex and held by minority shareholders, representing 13% of common shares and 38% of preferred shares of Eucatex.
As a result of the transaction, the Investor entered into a shareholders’ agreement with the shareholders members of the controlling block of Eucatex, who will seek, upon effective closing of the transactions described above, to carry out the migration of Eucatex to the special listing segment “Level 2” of B3.
READ THE EUCATEX STATEMENT IN FULL
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