BRAZIL Law and Practice Contributed by: Rodrigo Casarotti, Alexandre David, Ricardo Melaré and Gabriela Claro, /asbz
10. Disclosure 10.1 Making a Bid Public
In line with deal-activity trends, there has also been a marked increase in regulatory and compliance due diligence in fintech and other regulated technology verticals, with particular attention to financial services, payments and anti-money-laundering frameworks. Technology has led Brazilian deal volume in recent years, and fintechs are prominent both as targets and as acquirers, which reinforces the focus on licens- ing, conduct-of-business rules and supervisory inter- actions in these transactions. Tech due diligence in Brazil is now a mix of corporate, regulatory, IP and data protection workstreams. 9.2 Technology Company Due Diligence A listed company may share non-public information with a bona fide bidder for M&A diligence where there is a legitimate purpose and robust confidentiality and non-use obligations, mindful of inside-information handling, LGPD compliance and competition-law safeguards. There is no express rule mandating identi- cal information to all bidders, but equal-treatment and market-conduct principles mean boards should man- age access to avoid unjustified informational advan- tages, often via staged data rooms and comparable access for serious bidders at similar stages. Boards may authorise detailed legal/technical dili- gence of IP, software architecture, cybersecurity and data flows, subject to strict access controls for highly sensitive material (eg, source code/security configu- rations), LGPD-compliant handling (minimisation/ anonymisation, where feasible) and clean team pro- tocols where bidders are competitors. 9.3 Data Privacy There is no specific LGPD/ANPD rule establishing a distinct diligence regime for M&A or prohibiting diligence in transactional contexts. Any access to personal data in diligence must comply with LGPD principles and legal bases (purpose limitation, minimi- sation, security, transparency and data-subject rights). Practically, disclosure should be limited to necessary personal data (often pseudonymised where feasible), under appropriate contractual safeguards and tech- nical/organisational security measures. Parties may face ANPD sanctions and civil liability in case of mis- use, excessive collection or diligence-related security incidents.
A bid must be made public when it qualifies as a pub- lic tender offer ( oferta pública de aquisição de ações – OPA) under the Corporations Law, CVM regulations or by-laws (eg, control-sale tag-along, delisting, free- float restoration, voluntary takeover bids or poison-pill triggers). The bidder must register the OPA with the CVM and B3 and publish the offer announcement. The issuer must disclose the launch as a material fact under general disclosure rules. Until the decision to proceed with an OPA is taken, negotiations must be treated as confidential price-sensitive information; once filed/launched, the offer is public through regu- latory and market disclosures. 10.2 Prospectus Requirements A prospectus is not automatically required simply because shares are used as consideration. Whether a prospectus is needed turns on whether the con- sideration constitutes a public offering under CVM rules. Stock-for-stock transactions implemented as statutory reorganisations (mergers/incorporations/ spin-offs) typically disclose through merger protocols/ justifications, appraisal reports, meeting materials and market announcements, not a separate prospectus. In tender offers where the bidder’s shares are broadly offered to target shareholders, the OPA must be reg- istered and, absent an exemption, the public offering regime – including a prospectus – applies. There is no rule that consideration shares must be listed on a specific exchange; compliance with Brazilian offering/ disclosure requirements is the key when securities (or BDRs) are offered in Brazil. 10.3 Producing Financial Statements Financial statement requirements depend on struc- ture, not solely on cash versus stock. In a typical cash OPA, the bidder need not include full financials merely because it pays cash; regulation focuses on evidenc- ing settlement capacity (via financial-institution sup- port and funding disclosure). Where securities are used and particularly in statutory reorganisations, independent appraisal reports commonly support exchange ratios and price parameters.
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