Fri, 30 June 2023
Type of Secondary Transactions Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. There are several types of secondary transactions as follows: Confidentially marketed public offerings -- these offerings go to institutional investors. These transactions use an S3 form to provide shares to known buyers. Bought deal -- these shares are bought by an underwriter who takes the risk of the transaction. Since the risk is shouldered by one underwriter the shares are typically priced higher. PIPEs -- these are Private Investments in Public Entities and give private investors the ability to buy shares directly in the company without public disclosure. PIPEs are more heavily discounted. Block trades -- these are transactions used by smaller sellers to sell their shares directly to another buyer without having to go through an underwriter. These transactions provide alternative ways of completing a secondary sale.
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