Piper Jaffray
Encyclopedia
Piper Jaffray & Co. often shortened to just Piper Jaffray or PiperJaffray, is a U.S. middle-market investment banking
Investment banking
An investment bank is a financial institution that assists individuals, corporations and governments in raising capital by underwriting and/or acting as the client's agent in the issuance of securities...

 firm based in Minneapolis, Minnesota
Minneapolis, Minnesota
Minneapolis , nicknamed "City of Lakes" and the "Mill City," is the county seat of Hennepin County, the largest city in the U.S. state of Minnesota, and the 48th largest in the United States...

, and sells financial advice, investment products, and transaction execution within targeted sectors of the financial services marketplace. Through its principal subsidiary, Piper Jaffray & Co., the Company targets corporations, government, non-profit entities, institutional investors, and the financial advisory needs of private individuals.

History

Piper Jaffray traces its roots to 1895 when George Lane established George B. Lane, Commercial Paper and Collateral Loans & Co., a commercial paper
Commercial paper
In the global money market, commercial paper is an unsecured promissory note with a fixed maturity of 1 to 270 days. Commercial Paper is a money-market security issued by large banks and corporations to get money to meet short term debt obligations , and is only backed by an issuing bank or...

 brokerage, in Minneapolis. In 1913, Piper, Jaffray Co. was established as another commercial paper business by H.C. Piper Sr. and C.P. Jaffray. In 1917, George B. Lane & Co. merged with Piper, Jaffray & Co. to form Lane, Piper & Jaffray.

The firm first obtained a seat on the New York Stock Exchange in 1931 with the acquisition of Hopwood & Company, which had been devastated by the stock market crash
Wall Street Crash of 1929
The Wall Street Crash of 1929 , also known as the Great Crash, and the Stock Market Crash of 1929, was the most devastating stock market crash in the history of the United States, taking into consideration the full extent and duration of its fallout...

. In 1971, Piper first offered stock to the public and became a publicly held corporation known as Piper, Jaffray & Hopwood Incorporated. Later, in 1986, Piper's common stock began trading on the NASDAQ
NASDAQ
The NASDAQ Stock Market, also known as the NASDAQ, is an American stock exchange. "NASDAQ" originally stood for "National Association of Securities Dealers Automated Quotations". It is the second-largest stock exchange by market capitalization in the world, after the New York Stock Exchange. As of...

 under the ticker symbol PIPR. In 1997, the firm was acquired by Minneapolis based U.S. Bancorp
U.S. Bancorp
U.S. Bancorp is a diversified financial services holding company, headquartered in Minneapolis, Minnesota. It is the parent company of U.S. Bank, the fifth largest commercial bank in the United States based on $330 billion in assets. U.S. Bank ranks as the sixth largest bank in the U.S. based on...

 for $730 million in cash. From 1999 to 2003, the firm was known as U.S. Bancorp Piper Jaffray. In 2003 U.S. Bancorp spun off Piper Jaffray in a stock dividend to its shareholders, and today the company is traded independently under the symbol PJC. In 2006, the company sold its brokerage business to Zurich
Zürich
Zurich is the largest city in Switzerland and the capital of the canton of Zurich. It is located in central Switzerland at the northwestern tip of Lake Zurich...

 based UBS
UBS AG
UBS AG is a Swiss global financial services company headquartered in Basel and Zürich, Switzerland, which provides investment banking, asset management, and wealth management services for private, corporate, and institutional clients worldwide, as well as retail clients in Switzerland...

 for $510 million in cash. The business had approximately 800 brokers at that time.

Piper Jaffray now has 28 offices, with over 1,000 employees serving its capital markets clients.

Operations

The Capital Markets division includes investment banking, institutional sales and trading, and securities research. Focus areas include health care, consumer, financial institutions and technology. The firm is the largest underwriter of municipal bonds in its headquarters state of Minnesota. Piper Jaffray is especially noted for its underwriting of middle market IPOs
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...

, convertible securities, and private placements.

In July 2007, Piper Jaffray agreed to acquire Goldbond Capital Holdings Limited, a leading Hong Kong
Hong Kong
Hong Kong is one of two Special Administrative Regions of the People's Republic of China , the other being Macau. A city-state situated on China's south coast and enclosed by the Pearl River Delta and South China Sea, it is renowned for its expansive skyline and deep natural harbour...

-based investment bank, for approximately $50 million, funding the deal with 90% cash and 10% stock. The move aimed to give Piper Jaffray full capital-raising capability, especially for initial public offerings by Chinese companies that want to list on the Hong Kong Stock Exchange. Founded in 2003 by chairman and CEO Alex Ko who was previously head of corporate finance at BNP Paribas Peregrine Capital in Asia, Goldbond focused primarily on raising capital for and providing financial advisory services to HKEX-listed companies. It offered corporate finance, sales and trading, equity capital markets and research capabilities, and employed 70 people in HK as well as a small staff in Shanghai.

Piper Jaffray is putting a lot of emphasis on China, and it already has an office in Shanghai
Shanghai
Shanghai is the largest city by population in China and the largest city proper in the world. It is one of the four province-level municipalities in the People's Republic of China, with a total population of over 23 million as of 2010...

. In March 2007, it held its annual China growth conference, now in its fourth year, which looked at a broad range of growth sectors including the internet, technology, education, consumer, and solar power.

Piper Jaffray has been active in China since 2003 and is a leading equity underwriter for China
China
Chinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture...

 issuers listing on U.S. exchanges, with 23 completed deals from January 1, 2003 to June 2007. It has, for example, in February 2007 helped underwrite the $258.8 million initial public offering of JA Solar Holdings
JA Solar Holdings
JA Solar Holdings designs, manufactures, and sells monocrystalline solar cells primarily in the People’s Republic of China. It sells its products primarily through a team of sales and marketing personnel to solar module manufacturers, who assemble and integrate its solar cells into modules and...

 Co. in Ningjin
Ningjin
Ningjin may refer to the following places in China:*Ningjin County, Hebei , of Xingtai, Hebei*Ningjin County, Shandong , of Dezhou, Shandong*Ningjin Town , town in and seat of Ningjin County, Shandong...

, China, and in August 2005—the $123.4 million IPO of Baidu.com, often called the Google
Google
Google Inc. is an American multinational public corporation invested in Internet search, cloud computing, and advertising technologies. Google hosts and develops a number of Internet-based services and products, and generates profit primarily from advertising through its AdWords program...

 of China.

Piper Jaffray will now have offices in the world's three most important financial centers—New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...

, London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...

, and Hong Kong
Hong Kong
Hong Kong is one of two Special Administrative Regions of the People's Republic of China , the other being Macau. A city-state situated on China's south coast and enclosed by the Pearl River Delta and South China Sea, it is renowned for its expansive skyline and deep natural harbour...

.

Regulator fines

In 2002, Piper Jaffray was fined $25 million by state and federal regulators to settle charges that it provided biased stock
Stock
The capital stock of a business entity represents the original capital paid into or invested in the business by its founders. It serves as a security for the creditors of a business since it cannot be withdrawn to the detriment of the creditors...

 ratings. Other firms, such as JP Morgan and Goldman Sachs
Goldman Sachs
The Goldman Sachs Group, Inc. is an American multinational bulge bracket investment banking and securities firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients...

were also fined for similar reasons. The firm agreed to make structural changes relating to its research and investment banking program in order to restore confidence in its business.

External links


Additional Resources

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