Private Placements
Raising of capital via private rather than public placement. The result is the sale of securities to a relatively small number of investors. Investors involved in private placements are usually large banks, mutual funds, insurance companies, pension funds, and wealthy individuals.
Since a private placement is offered to a few, select investors, the placement does not have to be registered with the Securities and Exchange Commission. In many cases detailed financial information is not disclosed to potential investors. Finally since the placements are private rather than public, the average investor is only made aware of the placement usually after it has occurred.