BELGIUM Law and Practice Contributed by: Steven De Schrijver and Carl Dotremont, Allegiance Law
2.4 Venture Capital Venture capital funds secure their funding predomi- nantly from family offices, private funds and individual angel investors. Although less common, additional investors in venture capital funds may include govern- ment-backed institutions and investment companies, such as Noshaq, Participatiemaatschappij Vlaanderen NV, Limburgse Reconversiemaatschappij NV, Federale Participatie-en Investeringsmaatschappij NV and Bel- gian Growth Fund Comm V. 2.5 Venture Capital Documentation Belgium does not have specific nationwide regulations or standards governing venture capital documenta- tion. The structuring and documentation of venture capital deals must be in line with general contractual and corporate law and typically depends on negotia- tions between the parties involved – investors, start- ups and legal professionals. 2.6 Change of Corporate Form or Migration Belgian corporate law offers a highly flexible frame- work for organising companies, eliminating the neces- sity for start-ups to undergo changes in their corporate structure as they progress in development. Notably, even a private limited liability company (BV/SRL) can be listed on a securities exchange, enhancing the ver- satility of Belgium’s corporate landscape. Given Belgium’s appeal as a conducive home for companies across all developmental phases, the need to migrate to another jurisdiction is infrequent. Only if a start-up plans significant international expansion might it explore options that facilitate global opera- tions, such as setting up subsidiaries in other juris- dictions. 3. Initial Public Offering (IPO) as a Liquidity Event 3.1 IPO v Sale Belgium primarily emphasises its support for SMEs, a sector that may not find significant advantages in IPOs. Consequently, Belgian companies often turn to private equity transactions or other funds as a means of securing funding and enhancing their financial
standing. IPOs are notably infrequent as an exit strat- egy in Belgium. Although the IPO is widely acknowledged as a pres- tigious and lucrative way to gather funds, second- ary sales and trade sales are frequently favoured for achieving a complete exit by shareholders. In contrast to the IPO, where shareholders often retain their posi- tions, secondary sales and trade sales tend to result in a complete exit for shareholders. Dual-track processes are typically adopted by inves- tors seeking optimal flexibility and fostering competi- tive tension between the M&A and IPO paths. Owing to the substantial internal resources required, dual- track processes are generally reserved for companies exceeding a certain minimum size threshold. 3.2 Choice of Listing Euronext Brussels Euronext is a pan-European exchange that com- bines the stock exchanges of Amsterdam, Brussels, Lisbon and Paris into a single market. Euronext also has representatives in Germany, Switzerland, Spain and Italy. From young, growth-oriented companies to long-established enterprises, Euronext offers various types of markets with multiple entry points to provide issuers with a tailor-made listing offer. Euronext Brussels is cited as a centre of excellence in biotech and has distinguished itself in regulated real estate companies. If the company is active in these sectors, listing on Euronext Brussels may be strategic because of the knowledge and investor community present. If the company already operates in Belgium, it may be familiar with local regulations and Euronext Brussels listing requirements. This can ease the pro- cess of an IPO compared with exploring a foreign exchange. Euronext has recently invested in new technologies to automate the trading of financial products and has indicated its desire to grow by attracting new com- panies to list their shares on the exchange. Although there are challenges, such as regulatory issues and growing competition from other exchanges, Euronext Brussels has a strong position as a major player in the
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