The deal
PIPE
A private placement raised alongside the combination to replace cash lost to redemptions and validate the price.
Also written: private investment in public equity
A PIPE is committed by institutional investors at signing, typically at $10.00 per share, and funds at closing. It exists because redemptions are unpredictable and the target needs a minimum amount of cash.
The size and the quality of the PIPE book is one of the clearest external signals about a deal, since those investors have seen the target's numbers.
Related terms
Redemption
A public shareholder's right to hand back shares for their pro-rata share of the trust, exercisable at a vote.
Minimum cash condition
A closing condition requiring a floor of cash to survive redemptions, and a common reason deals collapse.
Business combination
The merger that turns the shell and a private company into one listed operating business.
See the term in the wild: the screener shows trust size, per-share value and deadlines for every U.S. SPAC, and each profile links to the filings the numbers came from.
Definitions describe market practice and are not investment, legal or tax advice.