UK Pipes are back – for now

Author: Danielle Myles | Published: 26 Aug 2015

Volatility and a lack of liquidity in Aim-listed stocks has sparked growing interest in UK Pipes [private investment in public equity]. But deals today may not be indicative of a long-term trend.

Private equity firms taking strategic stakes in public companies has been a feature of US, and to some extent Asian, markets for some time. In Europe, however, it has been more cyclical, and it’s approaching a new peak.

"There were a number of Pipes in the mid-2000s, where hedge funds, as well as mainstream investors and private equity houses were getting involved in a private-approach to public companies. That died away, but it is beginning to come back a bit now," said Anthony Dalwood, an advisor at LDC.

Pipe is a broad concept that encompasses a range of private-style investments made by institutional investors in listed companies. At its most basic, it involves a private placement of...