Coupon Accepted Successfully!

Private equity investments in listed companies (PIPEs transactions)

Private equity investment is a type of financial investment, taken by relatively mature companies – such companies have raised prior rounds of financial investment from angel investors and multiple venture capitalists. In the life cycle of a company, private equity investment takes place at a stage prior to the company going public.

Private equity investors, however, do not exclusively invest in unlisted companies. In certain situations they also identify investment opportunities in companies that are already listed on the stock exchange. These are known as PIPEs transactions (Private Investment in Public Equity), and are pretty niche – some of the biggest law firms advise on these transactions. 

Since the investment is made into listed companies, PIPEs transactions are subject to more rules compared to ordinary private equity transactions, which significantly impacts the documentation and the manner of executing the transaction. SEBI rules are applicable too.

How is a PIPEs transaction different from an ordinary private equity transaction? What are the objectives of a private equity investor who invests in a listed company?

Let’s hear from Sayak Maity, associate at AZB and Partners, to understand the difference between an ordinary private equity transaction and PIPEs transactions.

Test Your Skills Now!
Take a Quiz now
Reviewer Name