Investor Relations

Risk factors

Before making any investment decision, potential investors should carefully analyze all the information set forth in this offering memorandum, including the risks described below, as well as our financial statements and related explanatory notes. These risks, as well as others which are at present unknown to us or which we currently deem immaterial, may have a material adverse effect on our business and the trading price of our shares and potential investors may lose a substantial part or all of its investment.

Risks related to our business and to the Dental Plan Industry

  • Our results of operations may be adversely affected if we are unable to accurately estimate or control our budgeted dental care costs or are unable to increase monthly fees to offset increases in dental costs.
  • Increases in our claims reserves could adversely affect our results of operations.
  • A significant reduction in the number of our clients and/or members in our dental care plans could adversely affect the financial condition and results of operations.
  • We operate in a highly fragmented market and face significant competition from new and existing competitors, which could adversely affect our market share, financial condition and results of operations.
  • We do not have exclusive arrangements with our agents and brokers and cannot be certain that we will be able to maintain these services at competitive prices.
  • We may not be able to execute fully our business strategy.
  • We may be unable to retain members of our senior management team and qualified employees.
  • We may not be able to successfully integrate the operations of the businesses we acquire or achieve the benefits we expect from such acquisitions.
  • We may be unable to renegotiate contracts whith equal or more favorable terms with large clients from which we receive a significant percentage of our gross operating revenue.
  • Our future acquisitions may be subject to approval by Brazilian antitrust and health agencies which could result in delays or unexpected expense and which could have a material adverse effect on our results of operation.
  • Our business could be adversely affected by new government regulation including those establishing a system of government subsidized dental care.
  • Unfavorable judgments in judicial or administrative proceedings, including professional liability litigation, may adversely affect us.
  • Interruptions in the operations of our central office or of our computer systems located therein may have a material adverse effect on our operations and financial condition.

Risks related to Brazil

  • The Brazilian government exercises significant influence over the Brazilian economy. This involvement, and also the Brazilian political and economic situation, may at some time have an adverse effect on our activities, our business, or the market price of our common shares.
  • Inflation and certain government measures to curb inflation may have adverse effects on the Brazilian economy, the Brazilian securities market, our business and operations or the market price of our common shares.
  • The market value of securities issued by Brazilian companies is influenced by the perception of risk in Brazil and by the risk of other emerging economies, and actual or perceived deterioration in the level of risk in these economies could have an adverse effect on the price of our shares and limit our ability to access international capital markets.
  • Changes in Brazilian tax laws and the regulations of Brazilian health agencies could adversely affect our operating revenue.
  • Volatility in the exchange rate of the real against the dollar could adversely affect the Brazilian economy and the market price of our shares.
  • The Brazilian government may impose exchange controls and significant restrictions on remittances of reais abroad, which could adversely affect your ability to convert and remit dividends, distributions or the proceeds from the sale of our common shares and could reduce the market price of our common shares.
  • We may not be able to pay dividends or interest on shareholders´ equity to holders of our common shares.
  • Future acquisitions could have an adverse effect on the value of our common shares.
  • We may need additional capital in the future, which may not be available to us. The raising of additional capital by means of the issue of new shares may dilute shareholders’ ownership in our total capital.
  • The economic value of your investment may be diluted.
  • After this offering, we may no longer have one controlling shareholder or controlling group holding more than 50% of voting capital, which could leave us susceptible to alliances among shareholders, conflicts between shareholders and other similar events.
  • Our bylaws contain a provision that may deter a third party from acquiring our common shares, impede or delay transactions that may be in your interest.
  • We may be considered a passive foreign investment company, which could result in materially adverse U.S. tax consequences for U.S. investors.
  • The protections afforded to minority shareholders in Brazil are different from those in the United States and may be more difficult to enforce.

Last update on September 26, 2013