In the U.S., a PIPE offering may be registered with the Securities and Exchange Commission on a registration statement or may be completed as an unregistered private placement.
[citation needed] For private equity investors, PIPEs tend to become increasingly attractive in markets where control investments are harder to execute.
In recent years, top Wall Street investment banks have become increasingly involved in the PIPE market as placement agents.
Shares are sold at a slight discount to the public market price, and the company typically agrees to use its best efforts to register the resale of those same securities for the benefit of the purchaser.
However, in certain areas, there are stated preferences for rights issues, which allow existing shareholders an opportunity to invest before the company seeks outside capital.