Rule 144A vs Reg S
PPM.net can assist with your Reg S and 144A offerings
- Reg S is for raising capital outside the US, usually by issuing bonds for listing on in the Eurobond market via Clearstream or other overseas systems.
- Rule 144A is a way of raising capital in the US with only US investors, and QIBs can make certain trades of 144A securities among themselves without having to register with the SEC.
144A vs Reg S Definitions
Regulation S – “Bonds sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of, U.S. persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. Before seasoning, bonds sold under Regulation S (Reg S), can only be offered in the U.S. to qualified institutional buyers (QIBs) in reliance on Rule 144A.”
ISIN / CUSIP Registration for 144A vs Reg S
144A vs Reg S Bonds are generally assigned two separate sets of securities identification codes. Typically, Reg S bonds get a common code and an International Securities Identification Number (“ISIN”) and are generally accepted for clearance through the Clearstream, Luxembourg and other systems. 144A bonds get a CUSIP number and an “ISIN” and are generally accepted for clearance through the DTC system.
Rule 144A vs Reg S
144A is a private placement conducted within the US for US investors. QIBs are permitted to trade securities issued under 144A among themselves under certain conditions.
Reg S is a means of raising offshore capital (non-US) by issuing bonds in the Eurobond market for international investors. Reg S bonds can only be offered in the US to QIBs.
Rule 144A vs Reg S can also be used in complementary conditions. Note that after the initial period both series are normally merged mainly in an effort to increase the liquidity of such bonds. PPM.net is prepared to advise and provide all necessary documentation to come into compliance for qualification with the right option for your company.