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Posted On: 01/17/2018 9:42:21 PM
Post# of 4081
newbkk: in simple terms, the answer to your question is that APO and PIPE are just fancy terms that describe ways of public companies getting investment capital. Funds with money to invest buy equity stakes in companies directly from the company rather than buying free trading shares on the open market.
If shares are purchased on the open market, the shareholder gets the money, not the company, which doesn't help a growing company that needs cash to grow with. Companies that need cash will sell shares directly to investors. Shares sold can be common shares or preferred shares, or warrants that can be redeemed. IPO, APO and PIPE are the 3 most common ways used by companies to raise capital.
Hope this helps
If shares are purchased on the open market, the shareholder gets the money, not the company, which doesn't help a growing company that needs cash to grow with. Companies that need cash will sell shares directly to investors. Shares sold can be common shares or preferred shares, or warrants that can be redeemed. IPO, APO and PIPE are the 3 most common ways used by companies to raise capital.
Hope this helps
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