PIPE

Special purpose vehicles - acquisitions - Special Purpose Acquisition Companies - private equity.

Abbreviation for Private Investment in Public Equity.

A PIPE is an arrangement in which private financial investors take minority stakes in a SPAC, at a discount to the market price of the SPAC’s shares.

The purpose is to support the financing of the SPAC's combination with its acquisition target.

Example - Virgin Orbit's $100m PIPE

"Virgin Orbit, a small satellite launch service provider, is going public through a merger with a blank-check vehicle that values it at about $3.2 billion.

The deal with NextGen Acquisition Corp. II, announced on Monday, includes $100 million in funding from Boeing Co, AE Industrial Partners and others in the form of private investment in public equity, or PIPE...

The deal is expected to provide $483 million in proceeds to the combined company, which will list on the Nasdaq under the symbol "VORB" after the merger."

Source - Reuters - 24 August 2021

See also

• De-SPAC
• Dilution
• Disclosure
• Initial public offering
• Operating company
• Private equity
• Public company
• Reverse takeover
• Shell company
• SPAC