Glossary BG Image

Private Investment in Public Equity (PIPE)

Browse Terms By Number or Letter:
Financial Terms By: p
Private Investment in Public Equity (PIPE)

Occurs when private investors take a sizable investment in publicly traded corporations. This usually occurs when equity valuations have fallen and the company is looking for new sources of capital. This is a means by which a public company gets additional access to the equity markets in express mode-- they already have public shares trading and this is an additional offering to investors under a securities purchase agreement, the issuer promises to register the shares typically via a resale registration statement within so many days after the closing. In context of private equity, PIPEs is the investments by a privte euqity fund in a publicly traded company. The investments usually take form of preferred stock at a discount.

Copyright © 2018, Campbell R. Harvey. All Worldwide Rights Reserved. Do not reproduce without explicit permission.