Private Equity Placement
A private Equity placement (or non-public offering) is a funding round of securities which are sold without
- A private Equity placement (or non-public offering) is a funding round of securities which are sold without a initial public offering, usually to a small number of chosen private investors. Private equity placements refer to private capital investors that invest specifically in your company. Private equity is an umbrella term for large amounts of money raised directly from accredited individuals and institutions and pooled in a fund that invests in a range of business ventures. Private equity - Private equities are equity securities of unlisted companies. Private equities are generally illiquid and thought of as a long-term investment. Private equity investments are not subject to the same high level of government regulation as stock offerings to the general public.
- Private Equity Placement or PEP is a method to raise business finance especially a start up capital by a non conventional means. Loan against Property, Shares, Gold etc. or term loans, project loans are the conventional ways to raise funds for business. Private Equity Placement (PEP) means borrowing money from other persons.
- A borrower details the lender about the business venture and business prospects or opportunities and gets the lender involved in some or other business process or management. It depends upon the lender whether the lender is willing to participate in either business process or all over management.
- Private Equity Placement (PEP) is easier and faster way to raise the business finance. It is easier because the bank finance may be constrained by the means of hypothecation, mortgage or security valuation or the bank and borrower may not agree upon repayment terms or rate of interest etc. A borrower may face many smaller issues while getting the funds sanctioned and at the end it may equally result in not getting the funds sanctioned also. PEP proves much efficient in this scenario as the investor?s decision to provide the funds depends upon the references, business prospects and plan, growth prospects, market conditions etc. and informally on the personality of the borrower and the presentation of the proposal.
- It is faster because it involves lesser formalities. The lender makes quick decision whether to accept the proposal or to refuse it. Unlike banks and other lending institutions Private Equity Placement (PEP) requires quite less time and hence Private Equity Placement (PEP) helps the borrower to raise funds quicker than the conventional methods. Less documentation is required and hence the process is faster.
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