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...

Spun-off from Branson's space tourism company Virgin Galactic Holdings Inc in 2017, Virgin Orbit reached space for the first time in January when it delivered ten NASA satellites to orbit, after a failed attempt last year.

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

• Acquisition
• De-SPAC
• Dilution
• Disclosure
• Initial public offering
• Operating company
• Private equity
• Public company
• Reverse takeover
• Shell company
• Special Purpose Acquisition Company
• Special purpose vehicle