Private Investment In Public Equities

private investment in public equities (PIPE)

Private equity deals in which major investors purchase substantial amounts of the stock of public corporations, generally at significant discounts to market prices. PIPEs are especially popular during periods when financial markets are difficult to tap for public funding.

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Private Investment In Public Equities

The practice of a private investment company such as a mutual fund making a large investment in a publicly-traded company. This practice is similar to venture capital; the primary difference comes from the fact that PIPE is done for a company that is already publicly traded. PIPE is advantageous for the company because it is simpler and involves fewer regulatory hurdles than a new issue of securities; it can be advantageous for the investor because it usually receives shares in the company at a deep discount to their market value.