•  
• Tweet
•  
•        Print
•  
•         Track Keywords
•  
• 

From Kirsten Bischoff, Opalesque New York:

New York-based Cape One Financial Advisors, management firm for the Cape One Financial Fund will launch an offshore version of its PIPE fund in April.

Private investments in public equity (PIPEs) represent a relatively inexpensive and efficient way for publicly-traded companies to obtain additional capital funding. For firms with market caps less than $500m PIPE funding is typically sought, as it is even more difficult for these firms to raise funds through public offerings. (Source - ASquare)

PIPE investing dropped off steeply in 2008, and 2009 was the slowest year for PIPE deals since 2002. However, much of the deal-making drop off has been attributed to funds in the PIPE space seeing investor redemptions, and according to research in Deal Flow's The PIPEs Report, the market bounced back as funds saw assets stabilize, with the final quarter of 2009 showing 81% increase in deals than the final quarter in 2008.

For funds able to stay active over the course of the past two years, the drop off in PIPE activity represented an increase in opportunity, particularly in the small and micro market cap space that Cape One focuses on. The firm has returned 25% (net of fees) since its launch in January 2008. Portfolio Manager Reid Drescher told Opalesque "As a structured PIPE fund, Cape One's performance is low market-correlated and is largely a result of......................

To view our full article Click here