Hot on the heels of The SCO Group's announcement that BayStar Capital has invested $50 million in the company, questions are being raised about whether Microsoft Corp. may have had a role in that investment. As an investment firm, BayStar leads, creates and participates in a number of PIPEs (Private Investments in Public Equity). Many of these deals involve investment money from other companies, including Microsoft, sources said. But Bob McGrath, a spokesman for BayStar, disputed that claim, telling eWeek on Friday that BayStar had examined its records and could find no side-by-side PIPE or other investments that it had participated in along with Microsoft.
"Microsoft is also not an investor in this particular transaction. BayStar either leads, creates or is a major participant in private investments in public companies, also known as PIPEs, and has made 44 such investments so far this year. "They invest their own capital as well as put deals together that involve other investors but, again, this specific deal did not include Microsoft," he said. McGrath also pointed eWeek to a BayStar White Paper on PIPEs published in October 2002, which lists both Microsoft and Vulcan Ventures, Inc., the investment firm of Microsoft co-founder Paul G. Allen, as being among the top ten PIPE investors since 1995.
News source: eWeek