PE Week Wire 10/31-11/10

November 11 2005

Thursday Throwback

The sky is gray, the beloved Celtics finally won a buzzer-beater and Nanosys proves that VCs can be continually pacified by the promise of products (as opposed to the public markets, which generally like to see the things). In other words, it’s time for <s>Friday Feedback… err, Thursday Throwback.

First up was last week’s discussion of the Internet sector, which I believe is too broadly defined. Eric starts us off: “How can you consider a company like Vonage as not counting as an Internet company. The interface (telephone) is not Internet-based, but the service is unquestionably obtained via the Internet, without which, as is the case with eBay, the service wouldn’t exist. If users of eBay were interfacing with a desktop application (versus the current browser-based interface) that were updated via an internet connection, Vonage and eBay would be more comparable, but I imagine you’d still consider eBay to be an Internet company in that scenario.” Ron concurs: “Any ‘Internet company’ definition that doesn’t include Vonage is a bad definition.”

Janine picks up on a different point, which I mentioned only in passing: “Forget your new definition… Focus on your idea that maybe the whole notion of ‘Internet companies’ is obsolete (except maybe for ISPs). It made sense in 1998, but not today.” D writes: “What’s an Internet company? What’s a bubble? Reminds me of this segment of the Hichhiker’s Guide to the Galaxy film:

Dent retorts by saying, ‘Normality? We can talk about normality till the cows come home.’
Ford asks, “What’s normal?”
Trillian (who has just found out that Earth has been destroyed by Vogons) asks, ‘What’s home?’
And Zaphod, the two headed Galactic President, asks, ‘What’s a cow?’

Moving on to the week’s other big topic (as quantified by numbers of responses): The issue of VC blogging, vis-à-vis my podcast interview/Fred Wilson/etc. C writes: “I think your point on blogging is a valid one, although somewhat hard to fully support as it’s hard to know how much the blogging of a given VC cuts into his or her ‘personal’ time vs. his or her ‘work’ time… Even the most work ethic oriented LPs don’t expect their GPs to work a full 24 hours a day. Perhaps the issue is that blogging is a very visible activity, whereassitting at home, playing golf, etc. are less visible and thus less in the face of LPs (unless, of course, youmake the mistake of bragging onlineabout how your golf handicap has improved). As an aside, I think it’s interesting to note how many blogs seem to be very much ego-driven and thus take a “me-centric” approach to the content (i.e. you’re reading *my* blog, therefore you must be interested in *me*, and therefore you *must* be interested in! anything that is interesting to *me*).

Sam concurs: “I’m neither LP nor GP, but I believe you are correct on the VC blog issue. My gut says that VC blogs are driven primarily by three things: Ego (75%); Extrovert VCs who like the social interactions / it’s a hobby (20%); tting VC work done more efficiently or effectively (5%).”

On the other hand, Mario writes: “In my opinion, the reason why blogging is catching on is because you get to see something from that persons perspective. In order to understand his/her perspective it helps to know what makes them tick.” Billy: “In every endeavor, it takes all kinds – not necessarily to succeed, but to find out what will be successful. I’ve always enjoyed reading Buffet’s annual report – and have never held his stock – but I don’t think the time he takes to create it has detracted from his life-earned reputation for making money.”

Finally, there is fund-of-funds manager H: “We would be very concerned if one of the key GPsof a VC we are investors in was blogging at the expense of his job. However, I am not sure if blogging should be treated any differently from other ‘recreational’ activities a person would be engaged in regardless of his occupation. People cannot work 24 hours a day and need some times to relax or lay backor sleep… I am sure you would watch a Red Sox game from time to timeor engage in other social activities, too…

On the other hand, there have been cases where LPs were actually concerned though that the VC needed to be more focused.I recently heard commentsfrom my fellow LPs about aVC in Japanwhose fund was doing just fine, but the LPs felt that the sole key person was too engaged in political activities andnot focusing his attention enough on his job as a VC. A couple of the majorLPs have told him on numerous occasions that he needs to focuson his jobor they wouldbe uncomfortable about committing. As a conclusion,if the blogging or any other “extra curriculum activity” does not compromise the ability or work product ofa GP, we would not beconcerned.If we were concerned we may well not commit.”
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<b>
</b>Pinnacle Group International specializes in recruiting for PE and VC firms.
We are seeking candidates for the following positions:
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Director – Specialty Finance – Chicago
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Associate – Investment Bank – Los Angeles
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Associate – Private Equity – New Jersey
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Senior Associate – Venture Capital – Philadelphia
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Vice President – Specialty Finance – Bay Area
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Associate – Asset Management – New York
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Analyst – Asset Management – San Francisco
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Vice President – Consulting – Boston
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See Full List of Current postings
If you would like to be considered for any of these opportunities, click on the
links above and the APPLY button on the job description. We will review your
background in confidence and contact you
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<b> Top Three</b>
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<b>The Blackstone Group</b> has agreed to acquire hotelier <b>La Quinta Corp. and La Quinta Properties Inc.</b> (NYSE: LQI). The total deal is valued at $3.4 billion, with Blackstone paying $11.25 per share in cash (37% premium to Tuesday’s closing price). Debt financing will be provided by Bank of America, Bear Stearns and Merrill Lynch, while Morgan Stanley served as La Quinta’s advisor. The transaction is expected to close in the first quarter of 2006. www.blackstone.com www.lq.com

<b>PTC Therapeutics Inc.</b>, a South Plainfield, N.J.-based drug company focused on post-transcriptional control mechanisms, has raised $26.6 million in Series E-2 funding. Return backers CSFB Private Equity and HBM BioVentures co-led the deal, and were joined by Vulcan Ventures, Novo A/S, Delphi Ventures, Bay City Capital, Novartis BioVentures, Amgen Ventures and HealthCap. PTC has raised over $133 million in total VC funding since its 1998 inception. www.ptcbio.com

<b>Candover</b> has closed its latest European buyouts fund with 3.5 billion euros in capital commitments. New limited partners included Temasek, Partners Group, SPF Beheer and Massachusetts PRIM, while returning LPs included CalPERS, Canada Pension Plan, The Metropolitan Museum of Art, HarbourVest Partners, Princeton University and funds controlled by Standard Life. Candover used three placements agents: Benedetto, Gartland & Co. for North America, Konomi Inc. for Japan and UBS AG for the rest of the world, including Europe. The firm’s previous fund was capped at 2.7 billion euros in 2001. www.candover.com
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</b>Dinan & Company, LLC, a nationally known and recognized
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<b> VC Deals</b>
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<b>Firefly Mobile Inc.</b>, a Lincolnshire, Ill.-based maker of mobile phones for children, has secured $26 million of a $31.8 million Series D funding round, according to a regulatory filing. Backers include <b>Sevin Rosen Funds</b> and <b>ComVentures</b>. www.fireflymobile.com

Nanosys Inc., a Palo Alto, Calif.-based developer of nanotech-enabled products, has raised $40 million in Series D funding. El Dorado Ventures led the deal, and was joined by Masters Capital, Medtronic, Wasatch Advisors and return backers Alexandria Equities, ARCH Venture Partners, CDIB BioScience Ventures, CW Group, Harris & Harris Group, In-Q-Tel, Intel Capital, H.B. Fuller Co., Lux Capital, Polaris Venture Partners, Prospect Venture Partners, UOB Hermes Asia Technology Fund and Venrock Associates. www.nanosys.com

<b>Siimple Corp.</b>, an Arcadia, Calif.-based developer of integrated optical microsystems, has secured $20.13 million of a $23.4 million Series C funding round, according to a regulatory filing. <b>BA Venture Partners</b> joined return backers like Draper Fisher Jurvetson, Global Catalyst Partners, Portage Venture Partners and Zone Venture Partners. www.siimpel.com

<b>Payment Processing Inc.</b>, a Newark, Calif.-based provider of integrated payment processing solutions, has raised $20 million in funding from the private equity arm of <b>BlackRock Inc.</b> (NYSE: BLK). The deal is in exchange for a minority ownership position. www.paypros.com

<b>Quantum Leap Packaging Inc.,</b> a Wilmington, Mass.-based developer of liquid crystal polymer packaging solutions, has agreed to sell a 20% company interest to <b>Sumitomo Chemical Co.</b>, in exchange for a $20 million equity investment. Quantum Leap previously had raised $12.5 million in VC funding from Battery Ventures. www.qlpkg.com

<b>Ovalis Inc.</b>, a Mountain View, Calif.-based medical device startup, has raised $2.52 million in Series A-3 funding, according to a regulatory filing. Backers include De Novo Ventures, Abbot Labs and Latterell Venture Partners.
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<b> Buyout Deals</b>
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<b>Triton Pacific Capital Partners</b> has acquired <b>Safe Sedation Inc.</b>, a provider of anesthesiology services to ambulatory surgery centers in the greater Washington D.C. area. No financial terms were disclosed. www.tritonpacific.com www.safesedation.com

<b>Safeguard Scientifics Inc.</b> (NYSE: SFE) has agreed to acquire <b>Acsis Inc.</b>, a Marlton, N.J.-based provider of enterprise data collection solutions to global manufacturers.. The deal is valued at $26 million in cash, and is expected to close by year-end. www.safeguard.com www.acsis.com

<b>Cerberus Group</b> has agreed to become the largest shareholder in Japanese railway company <b>Seibu Group</b>. The private equity firm will invest 94 million yen ($800 million) in exchange for a 30% stake, while <b>Nikko Principal Investments Japan Ltd.</b> will receive a 15% stake in exchange for a 47 billion yen infusion. Seibu last month said that it is looking to raise a total of 160 billion yen.
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<b> PE-Backed IPOs</b>
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<b>CombinatoRx Inc.</b>, a Boston-based drug company focused on immuno-inflammatory diseases and cancer, priced 6 million common shares at $7 per share (low end of revised $7-$9 range), for an IPO take of approximately $42 million. SG Cowen and Pacific Growth Equities served as lead underwriters. The company had raised around $105 million in total VC funding since its 2000 inception, including a $15 million Series E infusion last month. Backers include Canaan Partners, TL Ventures, Boston Millennia Partners, Flagship Ventures, BioVentures Investors, Global Life Science Ventures and Adams Street Partners. www.combinatorx.com
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<b> PE-Backed M&A</b>
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<b>SkyTerra</b> <b>Communications Inc.</b> (OTC BB: SKYT), a portfolio company of <b>Apollo Management</b>, has agreed to acquire the remaining 50% of <b>Hughes Network Systems Inc.</b> that it doesn’t already own from <b>The DirecTV Group Inc.</b> (NYSE: DTV). The deal is valued at $100 million in cash, which SkyTerra will finance via a $100 million short-term debt financing from Apollo. SkyTerra acquired the initial 50% interest from DirectTV earlier this year for $246 million in cash and approximately $11.4 million worth of SkyTerra stock. Hughes provides broadband satellite networks and services to enterprises. www.skyterracom.com

<b>Emcore Corp.</b> (Nasdaq: EMKR) has acquired <b>Phasebridge Inc.</b>, a Pasadena, Calif.-based photonics company. No financial terms were disclosed. Phasebridge has raised around $17 million in venture capital funding since its 2000 inception, from firms like Clearstone Venture Partners, Intel Capital and TriQuint Semiconductor Inc. www.emcore.com www.phasebridge.com
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Versant Ventures, a Menlo Park, Calif.-based VC firm focused on the healthcare industry, has closed its third fund with $400 million in capital commitments. In other firm news, Versant has promoted Kevin Wasserstein to the position of managing director. www.versantventures.com

<b>Opus Capital</b> has been chosen as the name for the spinout firm from <b>Lightspeed Venture Partners</b>. PE Week has the story.

<b>Impulso Desarrollo Empresarial</b>, a Spain-based private equity firm, has been launched by four former executives of Santander Central Hispano, according to <i>Expansion</i>. The executives are Angel Corcostegui, Baldomero Falcones, Fernando Gumuzio and Concha Osacar.
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<b> Human Resources</b>
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<b>J. Michael Lawrie</b> has joined <b>ValueAct Capital</b> as a partner. He previously served as CEO of <b>Siebel Systems Inc.</b> and, before that, in various executive positions with IBM. www.valueact.com

<b>Bob Kavner</b> and <b>Fredric Harman</b> have joined the board of <b>Shop.com</b>, a Monterey, Calif.–based online marketplace operator. Kavner serves on the board of several other technology companies, while Harman is a general partner with Shop.com shareholder <b>Oak Investment Partners</b>. www.shop.com
___________________

<b>Correction:</b> Alta Partners should have been listed as an investor in Portola Pharmaceuticals’ $46 million Series B round, with Alta’s Farah Champsi joining the Portola board of directors.

<b>Random Ramblings</b>

Deadlines fast approaching, so just time for a few notes:

*** Visto Corp. today announced that it has raised $70 million in new venture capital funding. If this sounds familiar, it might be because this space first reported on the deal back in September (actually, we reported that Visto had raised “more than $66.6 million”). At the time, the Redwood City, Calif.-based mobile access company was authorized to raise upwards of $92.5 million, and one source close to the deal suggested that the ceiling could rise higher due to intense investor interest. So what happened?

Nothing, actually. It just seems that they wanted to get a press release out there. I spoke with Visto CFO Steve Anderson this morning, who says that the round remains open with the $92.5 million authorization in place. Visto continues to speak with potential new investors, and no final close date has been set. He also adds that Rustic Canyon Partners should have been included as a deal participant, and that its omission from the press release was just an oversight. DFJ ePlanet Ventures led the eighth-round deal (Series BB), and was joined by Rustic Canyon, Oak Investment Partners, Meritech Capital Partners, Draper Fisher Juvertson, VantagePoint Venture Partners and Allegis Capital. All $70 million closed in Q3, making it the quarter’s second-largest venture capital deal.

*** Some of you read Fred Wilson’s blog post yesterday, which was prompted by some comments I made during a recent podcast interview. The comments were essentially a disapproval of Wilson’s blogging efforts, which I suggested focused too much on diary-style entries, and too little on business. I said this fully understanding the importance of personality in blogging, but that certain LPs might not appreciate one of their VCs spending so much time on extra-circular content production. Blogging takes real time, no matter how fast a thinker or writer you may be, and a VC’s primary responsibility is money management, not content production. Perhaps this is why so many VC-written blogs are becoming more sparsely populated…

Many of Fred’s readers politely suggested that I’m out to lunch on this one, with an entrepreneur adding that he would want Fred (via Union Square Ventures) as an investor <i>because</i> he knows Fred as a flesh-and-blood person (or at least as a TypePad entity). I also submitted a comment, trying to extrapolate my views and to apologize for what sounded like an overly-harsh tone on the podcast (Fred later wrote that he didn’t take offense, which is quite magnanimous of him). I’ve been wrestling with this one all morning, and still believe that I’m generally correct, but some doubt is gnawing away at my ankles. What say you?

*** ABRY Partners is suing Providence Equity Partners, alleging that Providence fudged the books on a company it sold to ABRY. I’ll write more about this soon, as I’m currently immersed in a wholly-unrelated story about private equity litigation based, in part, on allegations of financial trickery…
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Vice President – Consulting – Boston
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<b> Top Three</b>
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<b>Apollo Management</b> has agreed to acquire retailer <b>Linens ‘n Things Inc.</b> (NYSE: LIN) for approximately $1.3 billion or $28 per share. The deal also includes equity commitments from NRCC Real Estate Advisors, and debt financing commitments from Bear Stearns & Co. and UBS Securities. It is expected to close in either the first or second quarter of 2006, pending shareholder approval.

Mersana Therapeutics Inc., a Cambridge, Mass.-based developer of novel oncology agents, has raised $21 million in second-round funding. Fidelity Biosciences and ProQuest Investments co-led the round, and were joined by Rho Ventures and return backers PureTech Ventures, Cape Family Fund, Harris & Harris Group and Lansing Brown Investments LLC.

Saifun Semiconductors Ltd., an Israel-based developer of nitride-read-only memory technology, priced five million shares at $23.50 per share (above $20.50-$22.50 range), for an IPO take of approximately $117.5 million. It plans to trade on the Nasdaq under ticker symbol SFUN, while Lehman Brothers and Deutsche Banc Securities served as lead underwriters. VC backers include Gemini Israel Funds, Concord Ventures and Argos Capital. www.saifun.com
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</b>Dinan & Company, LLC, a nationally known and recognized
investment banking firm, is seeking a Manager to assist
in the formation of the firm’s inaugural private equity fund of funds.

The selected individual will assist with fund documentation,
fund raising and management. Prior fund raising experience
is preferred. Excellent compensation package for the right candidate.

For more information about Dinan & Company, visit our website at
<b>www.dealassist.com

</b><b>For immediate consideration,
please send a resume and salary history to
mdinan@dinancompany.com
!</b>
</td></tr></tbody></table></div>

</td></tr></tbody></table></div>

<b> VC Deals</b>
</td></tr></tbody></table>

<b>Tekion Inc.</b>, a Champaign, Ill.–based developer of micro fuel cells for mobile products, has raised strategic funding from <b>Motorola Ventures</b>. No financial terms were disclosed, although a regulatory filing shows that Tekion recently secured $6.42 million of an $11.45 million Series B-2 round.

<b>FlowMedica Inc.</b>, a Fremont, Calif.-based developer of a catheter-based systems to prevent and treat kidney dysfunction, has raised $15 million in Series D funding. <b>De Novo Ventures</b> and <b>Palo Alto Investors</b> co-led the deal, and were joined by return backers AMRO Capital, Medica Venture Partners and Oxford Bioscience Partners. The company has raised over $25 million in total VC funding since its 2002 inception, including a $5.6 million Series C infusion in mid-2004 at a post-money valuation of approximately $14.64 million. www.flowmedica.com

<b>ONI Medical Systems Inc.</b>, a Wilmington, Mass.-based, has raised $7 million in Series B funding. Return backer <b>Galen Partners</b> led the deal, and was joined by Ivy Healthcare Capital and The Hospital for Special Surgery Fund. www.onicorp.com

<b>iQur Ltd.</b>, a UK-based developer of liver disease treatments, has raised Gbp2.6 million in third-round venture funding from firms like return backer <b>IP2IPO</b>. The company previously raised a Gbp350,000 seed round, and then Gbp1.6 million in Series A funding. www.iqur.com

<b>Ethertronics Inc.</b>, a San Diego-based developer of embedded antennae solutions, has raised $4.75 million in Series C funding, according to a regulatory filing. Backers include Sevin Rosen Funds and Excelsior Venture Partners (US Trust). www.ethertronics.com

<b>Cairo Inc.</b>, a San Ramon, Calif.-based provider of online services for customers of brick-and-mortar retailers, has raised $7.5 million in Series A-2 funding, according to a regulatory filing. Company backers include <b>Redpoint Ventures</b> and <b>Greylock Partners</b>. www.cairo.com

<b>ProTrade Sports Inc.,</b> a San Mateo, Calif.-based operator of a statistics-focused sports website, has raised around $10.13 million in Series B funding, according to a regulatory filing. Company backers include Radar Partners, NCD Partners, Deerwood Associates and Maverick Sports Ventures. www.protrade.com

<b>BioPassword Inc.</b>, an Issaquah, Wash.-based provider of authentication software solutions, has raised $8 million in second-round funding, as first reported by <i>The Seattle Post-Intelligencer</i>. OVP Venture Partners and Ignition Partners participated. www.biopassword.com

<b>Gynesonics Inc.</b>, a San Francisco-based medical device company, has raised around $3.93 million in Series A funding from firms like <b>Abingworth Management</b>, according to a regulatory filing.
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<b> Buyout Deals</b>
</td></tr></tbody></table>

<b>Nordic Capital</b> has agreed to sell <b>Ahlsell AB</b> to <b>Cinven</b> and <b>Goldman Sachs Capital Partners</b> for a reported 1.4 billion euros. Ahlsell is a Sweden-based wholesaler of installation-related products to the heating and plumbing, electrical, tools and machinery, refrigeration and do-it-yourself markets. www.nordiccapital.se www.ahlsell.com

<b>Bridgepoint</b> has agreed to sell its majority stake in German coffee and water dispenser company <b>Kaffee Partner AG</b> to <b>Odewald & Compagnie</b> for an undisclosed amount. Bridgepoint acquired the position in October 2002. www.bridgepoint-capital.com www.kaffee-partner.com

<b>Marwit Capital</b> has acquired <b>Women’s Diagnostic of Texas</b>, a Plano, Texas-based breast care organization. No financial terms were disclosed for the deal, which also included Capital Resource Partners. www.marwit.com www.womensdiagnosticoftexas.com

<b>KRG Capital Partners</b> has acquired <b>Focus Corp. Ltd.</b>, an Edmonton, Canada-based multidisciplinary consulting firm. No financial terms were disclosed. RSM EquiCo Capital Markets advised Focus Corp. on the deal. www.krgcapital.com www.focus.ca

<b>Varian Inc.</b> (Nasdaq: VARI) has acquired UK-based scientific instrument and vaccum technology company <b>PL International Ltd.</b> for Gbp24 million. The sellers include <b>3i Group</b>, which received Gbp6.5 million.
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<b> PE-Backed IPOs</b>
</td></tr></tbody></table>

<b>iRobot Corp.</b>, a Burlington, Mass.-based maker of the Roomba floor vacuuming robot, priced 4.3 million common shares at $24 per share (above $21-$23 range), for an IPO take of approximately $103.2 million. It will trade on the Nasdaq under ticker symbol IRBT, while Morgan Stanley and JPMorgan served as lead underwriters. VC backers include Acer Technology Ventures, Trident Capital, First Albany and Fenway Partners. www.irobot.com

<b>Molecular Insight Pharmaceuticals Inc.</b>, a Cambridge, Mass.-based developer of molecular imaging pharmaceuticals and targeted radio-therapeutics, has filed to raise $57.5 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol MIPI, with Piper Jaffray and SG Cowen serving as lead underwriters. The company has raised over $35 million in VC funding from firms like <b>Cerberus Capital Management</b> and <b>Siemens Venture Capital</b>. www.molecularinsight.com

<b>CombinatoRx Inc.</b>, a Boston-based drug company focused on immuno-inflammatory diseases and cancer, has reduced its proposed IPO pricing range from $10 to $12 per share, to $7 to $9 per share. It still plans to offer six million shares, with SG Cowen and Pacific Growth Equities serving as lead underwriters. The company has raised around $105 million in total VC funding since its 2000 inception, including a $15 million Series E infusion last month. Backers include Canaan Partners, TL Ventures, Boston Millennia Partners, Flagship Ventures, BioVentures Investors, Global Life Science Ventures and Adams Street Partners. www.combinatorx.com
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<b> PE-Backed M&A</b>
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<b>Thomson Corp.</b> (NYSE: TOC) has acquired <b>NexCura Inc.</b>, a Seattle–based provider of medical patient education and communication solutions, No financial terms were disclosed. NexCura has raised around $20 million in VC funding since its 1999 inception, from firms like ARCH Venture Partners, Cardinal Partners and Lilly Ventures. (<i>Note: PE Week Wire is published by Thomson Financial, a unit of Thomson Corp.</i>) www.thomson.com www.nexcura.com

<b>Intechra Holding Corp.</b> and <b>RetroBox LLC</b> have agreed to merge, creating a full-service information technology asset disposition annual revenue of approximately $40 million. Intechra has raised over $6 million in VC funding from firms like Clayton Associates and Chrysalis Ventures. www.intechra.com

<b>Smiths Detection</b>, a unit of Smiths Group PLC (LSE: SMIN) has acquired <b>LiveWave Inc.</b>, a Newport, R.I.–based maker of software systems which network large numbers of sensors and video cameras with connections to remote viewing and recording stations. No financial terms were disclosed. LiveWave has raised over $8 million in VC funding from firms like Zero Stage Capital and PSINet Ventures. www.livewave.com www.smithsdetection.com
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<b>Doughty Hanson & Co.</b> has held a 166.5 million euros first close on its second European real estate fund, including 57.5 million euros from Doughty Hanson and its real estate team. www.doughtyhanson.com
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<b> Human Resources</b>
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<b>Christoph Wedegaertner</b> and <b>David Mes</b> have joined <b>Cipio Partners</b> as associates in the firm’s Munich and San Jose, Calif. offices, respectively. Wedegaertner previously served as an investment manager with Munich-based family office BTV Group, responsible for private and public equities. Mes last worked with early-stage European VC firm NESBIC CTE Fund. In other Cipio news, the firm has promoted Munich-based associate <b>Gerhard Miller</b> to the position of principal. www.cipiopartners.com

<b>Flagship Ventures</b> has promoted principal <b>Samit Kaul</b> to the position of partner. He focuses on life sciences opportunities, and has been serving as founding CEO of startup Codon Devices, which is backed by Flagship, Alloy Ventures, Vinod Khosla and Kleiner Perkins Caufield and Byers. www.flagshipventures.com

<b>Jonathon Packard</b> and <b>Colin Smith</b> have joined the direct private placement team of <b>Atlantic-Pacific Capital</b>. Packard comes aboard as a vice president, and previously was a co-founder and executive vice president of WR Capital Management. Smith will serve as an associate, after having most recently worked as an analyst with Banc of America Securities. www.apcap.com

<b>Steve LaPorte</b> has joined <b>Onset Ventures</b> as a venture partner, after previously serving as a senior executive at <b>Medtronic</b>. His specific focus is the field of neuro-modulation, a category of medical devices that, like a pacemaker for the heart, uses electricity to stimulate a critical part of the nervous system to effect change in the body. www.onsetventures.com

<b>John St. Clair</b> has joined law firm <b>Jones Day</b> as a partner focused on M&A and capital markets transactions. He previously was with <b>Coudert Brothers</b>. Also coming to Jones Day from Coudert is <b>Paul Lin</b>, who will serve as of counsel. www.jonesday.com

<b>Battery Partner Charges Into China</b>

Will China soon have too many U.S.-based venture capitalists chasing too few early-stage technology companies? Ollie Curme seems to think so, which is why he’s forming a China-focused private equity fund focused on just about everything other than technology.

Curme has been a general partner with Battery Ventures for more than 20 years, investing in such companies as Chordiant Software, Fingerhut, dLife, Aurum Software, HNC Software, PixelWorks and OutlookSoft Corp. He began to get the China itch a few years back, and used his own money to participate in a few deals on a largely passive basis. He also served as chairman of New America Partners, a group dedicated to backing U.S.-based companies that could benefit by moving manufacturing operations to China. At the same time, Battery seemed like it was seriously considering the Chinese market, even joining the China Venture Capital Association at around the same time it closed its seventh fund. Battery, however, ultimately decided on India as it! s primary Asia focus, with China as a secondary interest. It made a deal for Tejas Networks and is planning to put someone on the Indian ground to help scout new opportunities.

But Curme’s itch didn’t go away, so he began laying the groundwork for a China-focused fund that will operate independently of Battery. The result is something tentatively named Shanghai Ventures, which will invest between $10 million and $50 million in revenue-generating companies within such sectors as industrial manufacturing, medical devices, logistics and energy. It is being launched in partnership with a Chinese government entity (agreement not yet formalized, so entity not yet identified), and Curme says he hopes to have a total staff of around 20 investment professionals. Fund-raising is scheduled to begin in January.

“I’ve been investing personally in China, and my feeling is that there is a lot more there than just tech,” Curme says. “The Silicon Valley firms are all over that, but what about energy, or supply chains or everything else?”

Curme plans to retain his general partner title and his Wellesley, Mass. office with Battery, but will not make any new investments on its behalf. Instead, he will focus approximately 75% of his time on the new venture, which will have some relationship to New America Partners, but I wasn’t able to get those specifics by press time.

All of this, of course, leaves us with an important question: Is Curme right about the pending saturation of early-stage tech VCs in China? We know that he’s right about there being lots of non-tech plays (consider Shanghai Ventures a much smaller-scale version of what Carlyle Group is doing there), but are we hitting the point when the market opportunity doesn’t justify the wing-tips on the ground? In just the past month we’ve gotten word of new China efforts from firms like Sequoia Capital, New Enterprise Associates and Kleiner Perkins, while Mobius Venture Capital co-founder Gary Reischel has relocated to Shanghai (new firm/fund announcement expected later this month).

Maybe this is all a bit of Baidu.com envy, and it ultimately may prove justified. But any time that the cattle begin to run, someone should turn around and make sure that there’s not just doing so because of peer pressure.
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Vice President – Consulting – Boston
</td></tr></tbody></table></div>

<b> Top Three</b>
</td></tr></tbody></table>

<b>Portola Pharmaceuticals Inc.,</b> a South San Francisco-based drug company focused on cardiovascular therapies, has raised $46 million in Series B funding. <b>Advanced Technology Ventures</b> led the deal, and was joined by return backers Abingworth Management, Frazier Healthcare Ventures, MPM Capital, Prospect Ventures and Sutter Hill Ventures. www.portola.com

<b>Elevation Partners</b>has agreed to make a $100 million PIPE investment in <b>Homestore Inc.</b> (Nasdaq: HOMS), a Westlake Village, Calif.–based provider of real estate media and technology solutions. The deal involves preferred stock convertible into shares of Homestore’s common stock at $4.20 per share, or approximately 18% above Homestore’s Nov. 4 closing price. If fully converted, the shares would represent approximately 14% of the company’s outstanding shares. www.homestore.com

Power Paper Ltd., an Israel-based provider of micro-power source technology, has raised $30 million in Series E funding. <b>Apax Partners</b> led the deal with a $16 million commitment, and was joined by Infinity Venture Capital, Clal Industries and return backer Banc of America Capital Partners. The company has raised around $67 million in total VC funding since its 1997 inception. www.powerpaper.com
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</b>Dinan & Company, LLC, a nationally known and recognized
investment banking firm, is seeking a Manager to assist
in the formation of the firm’s inaugural private equity fund of funds.

The selected individual will assist with fund documentation,
fund raising and management. Prior fund raising experience
is preferred. Excellent compensation package for the right candidate.

For more information about Dinan & Company, visit our website at
<b>www.dealassist.com

</b><b>For immediate consideration,
please send a resume and salary history to
mdinan@dinancompany.com
!</b>
</td></tr></tbody></table></div>

</td></tr></tbody></table></div>

<b> VC Deals</b>
</td></tr></tbody></table>

<b>Navio Systems Inc.</b>, a Cupertino, Calif.-based provider of rights-based commerce solutions, has raised $25.4 million in Series B funding. <b>WK Technology Fund</b> of Taiwan led the deal, and was joined by VantagePoint Venture Partners and return backer Add Partners. www.navio.com

<b>ShareFare Corp.</b>, a Los Altos, Calif.-based, has raised $7 million in Series B funding, according to a regulatory filing. Backers include <b>DCM-Doll Capital Management</b> and <b>Shasta Ventures</b> participated on the deal. Also listed is an entity called <b>Glenbrook II Holdings</b>, which is represented by <b>Jesse Rogers</b> of Golden Gate Capital. www.sharefare.com

<b>YouTube LLC</b>, a Menlo Park, Calif.-based provider of online video sharing services, has raised $3.5 million in venture capital funding from <b>Sequoia Capital</b>. www.youtube.com

<b>Inetcam Inc.</b>, a San Diego–based developer of multimedia applications for wireless devices, has raised $12.5 million in new funding from VC firm <b>Equal Elements</b>. The company has raised over $24 million in total VC funding since its 1999 inception, and <i>VentureWire</i> reports that the latest infusion is a recapitalization. www.inetcam.com

<b>Open Business Club GmbH</b>, a Hamburg, Germany-based social networking company for businesspeople, has raised 5.7 million euros in first-round funding. <b>Wellington Partners</b> led the deal, and was joined by returning angel backers. www.openbc.com

<b>Double Fusion Ltd.</b>, a San Francisco-based provider of in-game advertising solutions, has raised $10 million in Series B funding co-led by <b>Accel Partners</b> and <b>JVP</b>. In other Double Fusion news, the company has moved its headquarters from Israel to San Francisco, and also named <b>Geoff Graber</b>, former general manager of Yahoo Games, as its new CEO. www.doublefusion.com

<b>Mistletoe Technologies Inc.</b>, a Cupertino, Calif.-based semiconductor company, has raised $14.6 million in Series C funding, according to a regulatory filing. Worldview Technology Partners was joined on the deal by return backers Sevin Rosen Funds and Incubic Venture Capital. www.mistletoetech.com

<b>TraceSecurity Inc.</b>, a Baton Rouge, La.-based provider of on-demand security compliance management software, has raised $3 million in Series B funding. Individual backers include Dennis Cline (a principal with DCM Investment and CEO of netForensics Inc.), Sandra Bergeron and Tommy Frazer (former chairman of Fifth Generation Systems). www.tracesecurity.com
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<b> Buyout Deals</b>
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<b>Apax Partners</b> has agreed to acquire a majority ownership stake in <b>Triad Laboratory Alliance</b> (a.k.a. Spectrum Laboratory Network), a Greensboro, N.C.–based regional provider of clinical lab and disease screening services. Moses Cone Health Systems, one of the health systems that co-founded Spectrum in 1998, will retain a significant ownership position. No financial terms were disclosed for the deal, which is expected to close in the first quarter of 2006. www.apax.com www.spectrumlab.org

<b>Fairfield Energy Ltd.</b>, a newly-formed UK-based oil exploration and production company, has secured $200 million in provisional commitments from management and a private equity syndicate led by <b>Warburg Pincus</b>. Other syndicate members include SGAM/4D Global Energy Development Capital Fund and KERN Energy Partners. In related news, Fairfield agreed to acquire certain subsidiary companies from Acorn Oil & Gas Ltd., which include Acorn’s interests in the abandoned Maureen and Crawford fields. Fiarfield is led by executive chairman Chris Wright, who previously served as senior vice president of global exploration and technology for Unocal Corp. www.warburgpincus.com

<b>Credit Orienwise Group Ltd.</b>, a China-based provider of loan guarantees to small and mid-sized businesses, has received $25 million in private equity funding from <b>Citigroup Venture Capital International</b>. This is Credit Orienwise’s second equity infusion this year, after earlier raising $10 million from the Asian Development Bank.

<b>KRG Capital Partners</b> has completed its sale of <b>The Tensar</b> <b>Corp.</b> to an affiliate of <b>Arcapita Inc.</b> for approximately $385 million. Tensar is an Atlanta-based provider of technology-driven real estate site development. KRG had completed a $187 million recap of Tensar earlier this year, in which it recouped its initial investment. www.tensarcorporation.com

<b>Nautic Partners</b> has sold its stake in <b>Skyline Chili</b> to <b>Prudential Capital Partners</b> and company management. No financial terms were disclosed, although Nautic reports that the sale represents a 3.1x return on invested capital (25% IRR). Skyline Chili is a Cincinnati-based regional chain of 135 franchised and company-owned restaurants that specialize in Cincinnati-style chili. It also sells branded grocery products. www.nauticpartners.com www.skylinechili.com

<b>ANZ Capital</b> has sold <b>ACL Pty Ltd.</b> to <b>IBT Ltd.</b> for Au55.7 million, including an immediate patment of Au$40.7 million and Au$15 million of deferred payments. ACL Pty is an Australia-based provider of English-language trailing. www.acl.edu.au

<b>Converting Inc.</b>, a Clintonville, Wisconsin-based designer and manufacturer of disposable tabletop products, has completed a management buyout from the <b>Bob and Rae Rose</b> family. No financial terms were disclosed for the deal, which included equity sponsorship by <b>Mason Wells</b> and <b>Prudential Capital Partners</b>, senior financing from M&I Marshall & Ilsley Bank and Bank of Scotland and mezzanine funding from Prudential Capital Partners. www.convertinginc.com

<b>Bain Capital</b> has completed its acquisition of <b>FCI</b>, the connector subsidiary of <b>Areva</b>. The deal valued FCI at approximately 1.067 billion euros. www.fciconnect.com

<b>GIMV</b> of Belgium has acquired a stake in Dutch fruit and vegetable import/export company <b>De Groot International</b>, for an undisclosed amount.

<b>Lindsay Goldberg & Bessemer</b> has agreed to acquire <b>Cap Rock Energy Corp.</b> (AMEX: RKE), a midland, Texas-based provider of electricity distribution services in Texas. The going-private transaction is valued at approximately $163 million, or $21.75 per share. www.lgblp.com www.caprockenergy.com

<b>Oaktree Capital Management</b> has agreed to acquire the gelato division of Italy-based <b>Roncadin SpA</b> for approximately 152.5 million euros. www.roncadin.it www.oaktreecapital.com

<b>Tricor Pacific Capital</b> has acquired <b>Beresford Box Company Inc.</b>, a manufacturer of folding cartons for the food, consumer products,beverage and healthcare industries. No pricing terms were disclosed for the leveraged buyout, which was done in partnership with company management. Toronto Dominion Bank and Bank of Montreal provided senior financing. www.beresford-box.com www.tricorpacific.com

<b>The Timberland Co.</b> (NYSE: TBL) has agreed to acquire <b>SmartWool Corp.</b> from <b>RAF Industries Inc.</b> and the <b>Stripes Group LLC</b>. The deal is valued at approximately $82 million, and will be funded through Timberland’s existing cash balances and short-term borrowings. SmartWool is a Steamboat Springs, Colo.-based maker of socks, apparel and accessories. www.timberland.com www.smartwool.com
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<b> Other Deals</b>
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<b>Romacorp Inc.</b>, owner and franchisor of Tony Roma’s Restaurants, has agreed to a restructuring agreement with a majority of its bondholders. The deal would take place under Chapter 11, and would wipe out the equity stake of <b>Sentinel Capital Partners</b>, which acquired a controlling interest as part of a $109 million recap in 1998.
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<b> PE-Backed IPOs</b>
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<b>Clayton Holdings Inc.</b>, a Shelton, Conn.-based provider of mortgage-related loan analysis services, has filed to raise $230 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol Clay, with Piper Jaffray and William Blair & Co. serving as lead underwriters. <b>TA Associates</b> has held a majority ownership position in Clayton Holdings since May 2004. www.clayton.com
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<b> PE-Backed M&A</b>
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<b>Educational Services of America Inc.</b>, a Nashville, Tenn.–based provider of day-school services to children with special needs, has acquired <b>Ombudsman Educational Services Inc.</b> from its founder <b>Lori Sweeney</b>. No financial terms were disclosed. Ombudsman was founded in 1975 to provide an alternative approach to high school and middle school students who have difficulty being successful in a traditional school setting. ESA raised $35 million in private equity funding from <b>Trimaran Capital Partners</b> in October 2004. www.esa-education.com

<b>Ruesch International Inc.</b>, a Washington, D.C.–based provider of international payment services, has acquired <b>Trancentrix Inc.</b>, an Omaha, Neb.-based domestic and international payment services company. No financial terms were disclosed. Ruesch is principally owned by <b>Welsh, Carson, Anderson & Stowe</b>, while Trancentrix had raised venture capital funding from DFJ affiliate <b>Draper Atlantic</b>. www.ruesch.com

<b>Service Ratings LLC</b> has acquired <b>ValueStar</b>, a publisher of print and online directors of consumer ratings for local service businesses. Service Ratings raised $1.1 million in Series A funding earlier this year. www.valuestar.com
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<b>Energy Investors Funds</b> has closed its sixth institutional vehicle – United States Power Fund II — with $750 million in capital commitments. Limited partners include CalPERS, Howard Hughes Medical Institute, John Hancock Life Insurance Co., Kauffman Foundation, MIT, Pacific Life, UnionBanCal Equities and the University of North Carolina. The fund already has made three investments: Glen Park Hydroelectric Project, Neptune Regional Transmission System and a New York-based transmission project. www.eifgroup.com

<b>Aetos Capital</b> has closed Aetos Capital Asia II, a $2.2 billion fund formed to acquire real estate and related assets primarily in Japan. www.aetoscapital.com

<b>Christian & Timbers</b>, a New York-based executive search firm, has opened offices in both London and Paris. <b>Deidre Kenny</b> is the managing partner in London, while <b>Diane Segalen</b> is a vice chairman running the Paris operation. www.ctnet.com
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<b> Human Resources</b>
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<b>Kjerstin Barley</b> has joined <b>GE Commercial Finance-Technology Lending</b> as a San Francisco-based senior vice president of origination. She most recently served as a vice president in the I-banking unit of <b>Bear Stearns & Co</b>. www.getechnologylending.com

<b>3i Group</b> has named <b>Marco Fumagali</b> as managing director of <b>3i Italy</b>, effective in December. He has been with 3i since 1996. <b>Sergio Sambonet</b>, founder of 3i Italy and its current managing director, will transition into a chairman’s role once Fumagali takes over. www.3i.com

<b>Alexander Faust</b> has joined middle-market I-bank <b>Barrington Associates</b> as a vice president. He previously served as a vice president with <b>Goldman Sachs</b> and, before that, as founder and managing director of Cross-Border Transaction Management in Frankfurt, Germany. Barrington also has added six analysts: <b>Mitch Browne</b>, <b>Paul Hess</b>, <b>Don McGreal</b>, <b>Ryan Murphy</b>, <b>Ellie Roe</b> and <b>Forest Shultz</b>. www.barrington.com

<b>Kathryn Brown</b> has joined <b>Paul, Hastings, Janofsky & Walker LLP</b> as a London-based partner in the firm’s corporate department. She previously was with <b>Milbank, Tweed, Hadley & McCloy</b>, and will maintain her focus on private equity transactions. www.paulhastings.com

<b>Wilson Sonsini Goodrich & Rosati</b> has named 12 new partners, effective February 2006. They are: Ralph Barry (employee benefits and compensation), Mark Baudler (corporate), Michael Berta (litigation), <b>Todd Cleary</b> (corporate, with an M&A focus), <b>Adam Dinow</b> (corporate, including emerging growth companies, VC firms and I-banks), Caz Hashemi (litigation), Julie Holloway (litigation), Matthew Reed (litigation), <b>Julia Reigel</b> (corporate, focused on tech companies and their investors), <b>Allison Spinner</b> (corporate, focused on transactional and corporate governance issues for companies, VC firms, private equity firms and I-banks) and Nicole Stafford (litigation). www.wilsonsonsini.com

<b>Random Ramblings</b>

As I settle back into my regular chair, a few thoughts from last week’s Buyouts Symposium West in San Francisco…

*** Refco came up a few times, but almost always with an addendum about how it’s a one-off problem for Thomas H. Lee Partners, which otherwise has spectacular returns. This is basically true (Conseco and School Specialty notwithstanding), but it raised an interesting question: Why doesn’t TH Lee redeem itself by bidding on Refco during the November 9 auction? Sure there would be all sorts of problems – meet the new boss, same as the old boss – and the bankruptcy court judge may laugh even harder than at J.C. Flowers’ requested break-up fee, but why not take a shot at redemption. TH Lee knows Refco better than almost anyone else, and obviously has affinity for the business model. Install a new CEO (maybe Tom Lee himself, since he’s got some time on his hands), woo back nervous customers and prove that the buyout giant deserves its upcoming $7.5 billion fund-raising windfall. Sure it’s unrealistic, but I’m a hopeless romantic.

*** On the Refco front, there was a recent Financial Times article about a pair of former Refco Securities SA traders who are suing their former employer. Why? Because they allegedly got stiffed for nearly two years of fulltime work. So this raises an intriguing question: How long would you stay at a new job that didn’t cut you a single paycheck? I’d imagine the consensus answer is far less than two months, let alone two years. Refco Securities may well be guilty in this case, but the plaintiffs’ behavior is just bizarre.

*** David Rubenstein of Carlyle Group spoke last Wednesday at the Buyouts Symposium West, as part of his whirlwind tour of conferences large and small. He apparently spoke at the ILPA conference in New York that morning, got flown to SF, and then was off to speak at a Hamilton Lane event. You’d almost think he still has a book to sell, or maybe another fund to raise (well, there is that $1 billion-targeted Japan effort). Anyway, Rubenstein spoke about the institutionalization of private equity. It was largely a history lesson, explaining how the market has gotten to this point. He made three interesting observations:

First, he got asked to explain the difference between Carlyle and a typical corporate conglomerate. He kind of stumbled for a moment, which is odd for a man who must have been asked this question a thousand times before. Maybe it was simply for effect, since he arrived at an epiphany about how conglomerates acquire companies in order to control them and profit from them indefinitely, whereas Carlyle is constantly liquidating assets.

The second point was about SunGard, and the mega-buyout that Carlyle and TH Lee bailed on just days before the agreement was signed (Goldman Sachs and Providence picked up the slack with a pair of $500 million checks). He said that while each firm came up with around the same expected IRR, there should be concern about how long it will take each participant to exit. He didn’t say that this slow bleed was why Carlyle left (more likely a pricing issue), but pointed out yet another problem with what I believe could be an albatross of a deal. Not only was he referring to various lock-ups, but also to the overall post-IPO panic that could occur once one or more firms begin to seriously liquidate. Remember, the stock price shot up after word of a pending buyout leaked, the LBO firms paid a premium to the inflated price and admit that they can’t divest any major pieces due to tax reasons. In other words, they basically will tell the public markets in the next few years that the stock was undervalued by around 40% in early 2005. It still doesn’t make much sense…

Third, he noted that Carlyle spent around $500 million in I-banking fees over the past year. That’s just staggering…

*** Finally, a quick quiz: Can you name a financial institution whose buyout and venture capital groups are preparing to become much more independent. And no, the answers are not Morgan Stanley or JP Morgan (old news on both counts).
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Vice President – Consulting – Boston
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<b> Top Three</b>
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<b>Golden Gate Capital</b> has agreed to acquire <b>Geac Computer Corporation Ltd.</b> (Nasdaq: GEAC), a global enterprise software company focused on the needs of chief financial officers. The all-cash deal is valued at approximately $1 billion, or $11.10 per share. www.goldengatecap.com www.geac.com

<b>NexTone Communications Inc.</b>, a Gaithersburg, Md.-based provider of session management solutions for VoIP, has raised $35 million in Series D funding. <b>One Equity Partners</b> led the deal, and was joined by return backers BCE Capital, Core Capital, Mid-Atlantic Venture Funds and Safeguard Scientifics. The company has raised $67.5 million in total VC funding since its 1998 inception. www.nextone.com

<b>Computer Associates International Inc.</b> (NYSE: CA) has agreed to divest its <b>Ingres</b> open-source database unit into an independent corporation that would be majority-owned by <b>Garnett & Helfrich Capital</b>. No financial terms were disclosed for the deal, which would result in CA retaining a minority position. Terry Garnett, a managing director of Garnett & Helrich Capital, will serve as Ingres’ chairman and interim CEO. www.ca.com www.garnetthelfrich.com
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</b>Dinan & Company, LLC, a nationally known and recognized
investment banking firm, is seeking a Manager to assist
in the formation of the firm’s inaugural private equity fund of funds.

The selected individual will assist with fund documentation,
fund raising and management. Prior fund raising experience
is preferred. Excellent compensation package for the right candidate.

For more information about Dinan & Company, visit our website at
<b>www.dealassist.com

</b><b>For immediate consideration,
please send a resume and salary history to
mdinan@dinancompany.com</b>
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<b> VC Deals</b>
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<b>Aperio Technologies Inc.</b>, a Vista, Calif.-based provider of virtual microscopy systems to the healthcare IT market, has raised $17 million in Series B funding. <b>Galen Partners</b> and <b>Advanced Technology Ventures</b> co-led the deal, and were joined by Dako AS of Denmark. www.aperio.com

<b>Fovea Pharmaceuticals SA</b>, a France-based drug company focused on retinal diseases like age-related macular degeneration and macular edema, has raised 20.5 million euros in Series A funding. <b>Sofinnova Partners</b> led the deal, and was joined by Abingworth Management, The Wellcome Trust, GIMV and Credit Agricole Private Equity. www.fovea-pharma.com

<b>Luminetx Corp.</b>, a Memphis, Tenn.-based developer of the <i>VeinViewer</i> medical imaging system, has raised $11 million in Series A funding. Stanford Financial Group led the deal, and was joined by Elm Ridge Capital, Capvest Venture Fund, Custer Capital and Diomed Holdings. Morgan Keegan served as placement agent. www.luminetx.com
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<b> Buyout Deals</b>
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<b>GFrancisco Partners</b> has agreed to acquire all outstanding shares of <b>FrontRange Solutions Inc.</b> for approximately $200 million. The deal is expected to close within the next 90 days, subject to FrontRange shareholder approval. FrontRange is a Dublin, Calif.–based provider of service management, CRM and voice application solutions for small-to-medium sized enterprise and distributed enterprise markets. It is wholly-owned by FrontRange Ltd., which is publicly traded in South Africa. www.frontrange.com www.franciscopartners.com

<b>Bridgepoint</b> has agreed to sell its 50% stake in <b>Really Useful Theaters Ltd.</b> to joint venture partner <b>Andrew Lloyd Webber</b>. No financial terms were disclosed, although Webber pledged an additional Gbp10 million for an ongoing theater refurbishing program. www.seetickets.com

<b>Clearbrook Capital</b> reportedly is in talks to acquire UK pub chain <b>Spirit Group</b> for approximately Gbp3 billion. The deal would be done in partnership with brewer <b>InBev</b>, which also would provide beer to the Spirit pubs. www.clearbrook.com
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<b> PE-Backed IPOs</b>
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<b>Cardica Inc.</b>, a Redwood City, Calif.-based maker of automated anastomotic systems used by surgeons to perform coronary artery bypass surgery, has filed to raise $40 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol CRDC, with A.G. Edwards and Allen & Co. serving as lead underwriters. Cardica has raised around $28 million in VC funding from firms like Allen & Co., Sutter Hill Ventures and Guidant Corp. www.cardica.com

<b>Brookdale Senior Living Inc.</b>, a Chicago-based operator of senior living facilities throughout the United States, has set its proposed IPO terms to around 11.07 million common shares being offered at between $17 and $19 per share. It plans to trade on the NYSE under ticker symbol BKD, with Goldman Sachs and Lehman Brothers serving as lead underwriters. Fortress Investment Holdings LLC is Brookdale’s majority shareholder, while Capital Z Partners also holds an equity position. www.brookdaleliving.com

<b>Actions Semiconductor Inc.</b>, a China-based chip design company, has set its proposed IPO terms to 13 million American depository shares (ADS) being offered at between $9.50 and $11.50 per share. CSFB is serving as lead underwriter. Shareholders include Tetrad Ventures Ltd. and rich Dragon Consultants Ltd., while press reports have suggested that the company is closing in on $80 million in Series A funding, largely from U.S.-based firms.

<b>Under Armour Inc.</b>, a Baltimore, Md.-based provider of performance apparel and accessories, has set its proposed IPO terms to around 12 million common shares being offered at between $7.50 and $9.50 per share. The company plans to trade on the Nasdaq under ticker symbol UARM, with Goldman Sachs serving as lead underwriter. Under Armour lists <b>Rosewood Capital</b> as a minority shareholder. www.underarmour.com
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<b> PE-Backed M&A</b>
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<b>Simulations Plus Inc.</b> (AMEX: SLP) has acquired <b>Bioreason Inc.</b>, a Santa Fe, N.M.-based chemistry software company providing research tools to the pharmaceutical and biotech industries. The all-cash deal is valued at approximately $788,000. Bioreason had raised around $8 million in VC funding from firms like Future Capital AG, Invencor Inc. and Colorado Venture Management. www.simulations-plus.com www.bioreason.com
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<b>Morris Anderson & Associates</b>, a Chicago–based performance improvement and turnaround management consultancy, has opened an office in Los Angeles. It will be run by new managing director <b>Michael Cavan</b>, who previously led the West Coast corporate consulting practice of Navigant Consulting. www.morris-anderson.com
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<b> Human Resources</b>
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<b>Les Brownlee</b>, former Acting Secretary of the <b>U.S. Army</b>, has joined <b>American Capital Strategies Ltd.</b> as an advisor. He will help American Capital identify investment opportunities in the federal contracting market. www.acas.com

<b>Robert Alexander</b> has joined <b>Alta Partners</b> as a principal. He previously served as a principal in <b>MPM Capital</b>’s BioEquities Fund and, before that, worked for over three years in business development at Genentech. www.altapartners.com

<b>Vinit Nijhawan</b> has joined <b>Key Venture Partners</b> as a venture partner, where he will focus on opportunities in the televom, wireless and software spaces. He previously served as president and CEO of <b>Taral Networks</b> and, before that, was founder, president and chairman of Finetic Computer Corp. www.key.com/keyventurepartners

<b>Steven Jenkins</b> has resigned as vice president and CFO of <b>First Albany Companies Inc.</b>, and as managing director, CFO and COO of <b>First Albany Capital</b>. The reason given for his departure was a desire to “pursue other interests,” and he will serve as a consultant to First Albany to help with the transition. www.firstlabany.com

<b>Bill Cadogan</b>, a venture partner with <b>Vesbridge Partners</b>, has joined the board of <b>Synchronoss Technologies Inc.</b>, a Bridgewater, N.J.-based provider of back-office software for large network carriers. www.synchronoss.com

<span>Let the Venture Funds Lose Their Tails <i>or</i> The Intelligent Design of the Secondary Market

Dan is flying back from Buyouts Symposium West right now, as is Adam Reinebach, which leaves the daily newswire in my hands. I’m Matthew Sheahan, a colleague of Dan’s based in New York.

My primary focus is reporting on the secondary market (my secondary focus is not the primary market, however, but on limited partners). Earlier this week I met and had coffee with the leader of a well reputed secondary firm and asked about a topic I’ve been following: the direct venture secondary market and who are its sellers.

So far the sellers on the market are for the most part non-traditional venture groups such as corporate VC units, banks and others. This secondary buyer I met with was bullish on the prospect that traditional venture capitalists will become more willing to sell portfolio assets on the secondary market.

The market for this exists mainly in so-called “tail ends,” remaining assets in venture portfolios that still remain after most of the exits have been made and the fund is mostly wound down. These are companies that may be perfectly healthy, but do not hold the prospect of making a dynamic return and won’t “move the needle” very much. The conventional wisdom among many VCs is that selling such assets before they are realized would anger limited partners.

The secondary executive I spoke with tells me that the VCs need to check back with their LPs. LPs would be happy to move these tail ends from their books to their bank accounts. Sell on the secondary market and cut them a check already – or so the argument goes.

Most of the traditional VCs I spoke with still tend to view selling on the secondary market as a bad idea. It’s our job, they tell me, to see these companies through to the end. To do otherwise would be a betrayal of sorts and would reflect badly on the firm. If the portfolio company stays on the books too long, they’ll simply cut the management fees to accommodate their LPs.

I tend to agree with my secondary source and think its time that VCs start considering going to the secondary market with tail ends more frequently. A good VC wants to stand by his or her portfolio companies to the very end, and this is admirable. But it overlooks that a venture firm’s primary responsibility is to its limited partners. Fees or no fees, an LP would rather have a check to put in the bank than extra books to keep.

I wrote about this topic in <i>Venture Capital Journal</i> in June and I’d like to hear from our Wire readers who are in the know. If you are a VC, have your thoughts on selling tail ends evolved over the past few years as the secondary market has matured? If you are an LP – would you rather have your venture GPs selling on the secondary market to tidy up these tail ends, or is cutting fees good enough for you? And if you’re a placement agent – how much interest are traditional VCs showing in this market? Feel free to email me at matthew.sheahan (‘at’) thomson.com or click the anonymous tip button on the right.

Thanks. Dan will be back on Monday.
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<b> Top Three</b>
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<b>Vonage Holdings Corp.</b> is readying to raise as much as $600 million in an IPO or may be acquired for as much as $2 billion, according to <i>The Wall Street Journal.</i> Vonage has raised almost $400 million in VC backing from 3i, Bain Capital, Institutional Investment Partners, Meritech Capital and New Enterprise Associates. Vonage provides Internet-based phone service. www.vonage.com

CBS agreed to acquire <b>CSTV Networks,</b> a PE-backed provider of college sports programming for $325 million. New York-based CSTV’s backers include Allen & Co., Chilton Investments, Constellation Ventures, Court Square Ventures, J.P. Morgan Partners and TowerBrook Capital Partners. www.cstv.com

<b>Corsair Capital</b> announced it will be operating independently of JPMorgan and named former Abbey National CEO Luqman Arnold as a new partner. The firm is also opening a London office. www.jpmorgan.com
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</b>Lineage Capital, a Boston-based middle-market private equity firm focused on family-controlled and owner-managed businesses is seeking an Associate to assist in all aspects of the investment process. Associates play a critical role in the evaluation, negotiation, structuring and monitoring of portfolio companies and work in small deal teams in an entrepreneurial environment. Pre- and post-MBA candidates are welcome to apply. www.lineagecap.com
<p class=”regtext” style=”MARGIN: auto 0in; TEXT-ALIGN: center” align=”center”><b>Please email cover letters and resumes to:
resumes@lineagecap.com

</b>**Email only, please
<i>All submissions will be deemed highly confidential</i>
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<b> VC Deals</b>
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<b>Sensors for Medicine and Science,</b> a Germantown, Md.-based developer of sensor technology, announced that it received $15 to close the second tranche of a $30 million Series C round. The first tranche was raised in 2002. New Enterprise Associates and HealthCare Ventures are the round’s principal investors. Other backers include Abingworth Management, Anthem Capital, Rho Capital Partners and individuals. www.s4ms.com

<b>AkaRx</b> has raised a $12.5 million first round, according to <i>Dow Jones.</i> The Paramus, N.J-based developer of clinical-stage cancer and hematology products raised the funding from InterWest Partners and Sutter Hill Ventures.

<b>Ryma Technology Solutions,</b> a Montreal-based enterprise product management services provider, said it raised $3 million from Novacap. The company says it will use the funding to expand its FeaturePlan product. www.featureplan.com

<b>XVionics,</b> a Washington, D.C-based provider of aviation control software, announced it raised a $3 million Series B led by SCP Partners. The company has raised a total of $11 million to date. www.xvionics.com

<b>Yelp</b> announced it closed its first round of venture funding, which was led by Bessemer Venture Partners. Yelp operates a web site for localized social networking and directory services. www.yelp.com
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<b> Buyout Deals</b>
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<b>The Carlyle Group</b> has purchased Troy, Mich.-based axle and brake component supplier AxleTech International from Wynnchurch Capital Partners and Resilience Capital Partners for a cash payment of $335 million. The deal includes potential additional payments of up to $10 million. www.wynncurch.com, www.resiliencecapital.com

<b>Bain Capital</b> has acquired Versailles, France-based connector system manufacturer FCI from French energy group Areva. www.fciconnect.com

<b> PE-Backed M&A</b>
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<b>Iolon'</b>s assets will be purchased by Coherent (NASDAQ: COHR) for approximately $5 million in cash. The San Jose, Calif.-based optical component maker raised approximately $80 million since its 2000 founding. Iolon’s backers included BA Venture Partners, Bowman Capital, CSFB, Corning Innovation Ventures, DCM – Doll Capital Management, Goldman Sachs and Kleiner Perkins. www.iolon.com

<b>Redbus Interhouse</b> and <b>Telecity</b> have agreed to accept a recommended cash offer made by Torch Partners and merge. Telecity is backed by 3i Group, M&G Group and Schroders. www.telecity.com

<b> PIPEDeals</b>
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<b>Javelin Pharmaceuticals</b> (OTC BB: JVPH) said it will raise approximately $32 million in PIPE financing led by NGN Capital and investment funds associated with Wexford Capital and other institutional investors. http://javelinpharmaceuticals.com
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<b>Cadent Energy Partners</b> announced that it completed raising its first fund, Cadent Energy Partners I, this past summer with $220 million. The Cadent team had previously managed energy investments with RBC Capital Partners, the private equity unit of the Royal Bank of Canada. Cadent counts the bank among its LPs and continues to manage some energy investments on its behalf. www.cadentenergy.com
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<b> Human Resources</b>
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<b>InterWest Partners</b> promoted four principals, Nina Kjellson, Ellen Koskinas, Doug Pepper and Victor Westerlind, to partner. www.interwest.com

Chewing on the Bubble

Is the Internet market headed for another bubble? That seems to be the question on everyone’s mind here in San Francisco, so let me clear it up for you: I don’t know. Neither do you, and anyone who confidently exclaims “Yay” or “Nay” is lying to both himself and to others.

The basic problem is that the market’s very terminology is outdated. What is an “Internet company” in 2005? Is it just online retailers, Internet search providers and social networking companies, or do broadband phone companies, mobile gaming companies and Comcast also count? What about my employer Thomson, which distributes most of its products online, but which also rakes in cash off print ads in <i>Buyouts Magazine</i> and one-off client research projects? Is Thomson an Internet company? Even Google offers desktop search products now, although they must first be downloaded off the Web. The point is, categorizing this sort of thing can be more art than science as the world’s relationship to the Web continues to evolve.

Before concluding that there will or won’t be a bubble, therefore, we must first redefine what it means to be an Internet company. My suggestion is as follows: An Internet company is a company whose main product is <i>identifiably</i> obtained/consumed by end-users via the Internet. So eBay is obviously an Internet company, because all eBay users realize that they must use the Internet to use its auction services. Ditto for Google’s search functions, or that interesting/non-revenue producing Frappr gizmo. A company like Vonage, however, doesn’t count, because the end-user still uses a traditional telephone. Ditto for Amp’d Mobile, which will primarily be recognized by its actual devices. Most networking infrastructure companies also get knocked out by this definition, because they are rarely by end-users.

I recognize that this excludes many, many companies that would have no reason for existence without the Internet. I also recognize a contrarian’s argument that any Internet company definition is itself anachronistic, since the only real differences between Expedia.com and the local travel agent are distribution channel and volume. However, this bubble analysis needs some specific standards in order to consider the possibility of a bubble, and this is where I feel the line is best drawn (feel free to disagree, as I know you will).

So on our bubble question. For a bubble to be forming, we must confirm the following two statements: (A) There has been a significant increase in Internet company investments; and (B) The valuations of those investments has been artificially inflated due to unreasonable optimism, perceived competition, etc.

A: Recent venture disbursement data from the PWC/Thomson VE/NVCA Money Tree Survey suggests that there was a substantial decrease in Internet investments between Q2 2005 and Q3 2005 – specifically from around $840 million in Q2 to around $613 million in Q3. Let me suggest that a major reason for this supposed decrease is that their operative terminology is the aforementioned catch-all – a definition whose organic overgrowth caused it to become too many things to too many people

I went through all PE Week Wire issues for Q2 and Q3, looking for disclosed VC fundings in Internet companies as I’ve defined them. The result? A 60% increase in the number of Internet investments from Q2 to Q3. Even more staggering is the actual amount of capital invested, with around $492 million disclosed for Q3 companies compared to just $208 million disclosed for Q2 companies. This is, indeed, a significant increase. (Remember that my parameters exclude companies like Vonage.)

B: This is the part we simply don’t yet know. We don’t yet have a large enough valuation sample to prove a substantial increase and, even if we did, it is too early to suggest that such an increase is artificial. It is easy to jump on Web 2.0 companies, in particular, but the reality is that most Internet companies raising VC funding in Q2 and Q3 were not of the Web 2.0 variety (often identifiable by the use of Q’s or X’s as single syllables in company names).

Believe me when I tell you that I’d like to have an affirmative or negative conclusion. I’d like to be the seer who accurately asserts that today’s Internet frenzy equals folly, and that some Silicon Valley VCs will soon remember the lessons of CMGI. Or to become head cheerleader for the next generation of revenue-producing innovation. But to do so today would be premature, so we must all resist the temptation a bit longer.

Publishing Note: I’ll be on an early flight from SF to Boston tomorrow morning, so my colleague Matthew Sheahan will be putting together tomorrow’s PE Week Wire. I’ll be back on Monday with some thoughts/observations from the past few days of Buyouts Symposium West. Thanks in advance Matt…
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<b> Top Three</b>
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<b>Elevation Partners</b> has made its first investment: A holding company to own control positions in video game developers <b>Pandemic Studios LLC</b> and <b>BioWare Corp.</b> The transaction value is more than $300 million, including future capital needs and rollover of founders’ shareholdings. The holding company will be jointly managed by from Elevation, Pandemic and BioWare, and will feature more than 450 employees. www.elevationpartners.com

<b>HSF Holding Inc.</b>, the Honolulu-based parent company of a nascent Hawaiian inter-island ferry service operator Hawaii Superferry Inc., has raised $237 million in private equity and debt. The funding will be used to acquire two high-speed catamaran ferries built by Austal USA, and to begin inter-island ferry service by early 2007. The deal includes $80 million in equity led by <b>J.F. Lehman</b> (lead) and <b>Norwest Equity Partners</b>. It also includes $140 million in senior debt financing from ABN-Amro and $17 million in subordinated notes from Austal USA. In addition, there has been $40 million appropriated by the state of Hawaii to supplement port development. www.hawaiisuperferry.com

<b>Devax Inc.</b>, an Irvine, Calif.-based developer of a drug-eluting stent for the treatment of vascular bifurcations, has raised $32 million in Series D funding. <b>InterWest Partners</b> and <b>U.S. Venture Partners</b> co-led the deal, and were joined by Bio-Star Private Equity Fund. Piper Jaffray advised Devax on the transaction. www.devax.net
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</b>**Email only, please
<i>All submissions will be deemed highly confidential</i>
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<b> VC Deals</b>
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<b>Iconoculture Inc.</b>, a Minneapolis–based provider of strategic consumer advisory services, has raised $10 million in third-round funding. <b>WaldenVC</b> led the deal, and was joined by General Mills and return backer VSP Capital. www.iconoculture.com

<b>Peppercoin Inc.</b>, a Minneapolis-based payment technology company for providers of low-priced digital and physical goods, has raised $2 million in additional second-round funding from <b>Total Technology Ventures</b>. This brings the round total up to $10 million, including a prior infusion from Wall Street Technology Partners, Pod Holding and others. www.peppercoin.com

<b>Medio Systems Inc.</b>, a Seattle-based provider of mobile search solutions, has raised $11 million in first-round funding. Participants included Frazier Technology Ventures, Mohr Davidow Ventures and Dot Edu Ventures. www.mediosystems.com

<b>Privaris Inc.</b>, a Charlottesville, Va.-based provider of wireless biometric technology, has raised $15.7 million in Series A funding. Harbert Venture Partners led the deal, and was joined by return backers Noro-Mosley Partners, River Cities Capital Funds, SpaceVest Capital and returning seed backers. www.privaris.com

<b>Beecem Communications Inc.</b>, a Santa Clara, Calif.-based wireless broadband technology provider, has raised $19.5 million of a $30 million Series C funding round, according to a regulatory filing. Backers include Walden International, Sequoia Capital, Global Catalyst Partners and KPS Partners. www.beceem.com

<b>Zag.com Inc.,</b> a Santa Monica, Calif.-based provider of online auto sales, has raised $8.1 million of a $10.5 million Series B funding round, according to a regulatory filing. Participants included Capital One Financial Corp., Anthem Ventures and Arcturus Capital. www.zag.com
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<b> Buyout Deals</b>
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<b>Diamond Castle</b>, a New York-based private equity firm, has completed its acquisition of a controlling interest in <b>Catamount Resources Corp.</b>, the unregulated wind development subsidiary of <b>Central Vermont</b> <b>Public Service</b> (NYSE: CV). The deal included an initial payment of $16 million, and a total funding commitment of $62.5 million. Contingent on completion of Catamount’s Sweetwater III project in Texas, Diamond Castle also agreed to buy CRC’s entire interest in Catamount for $60 million in cash (less certain transaction expenses), at CRC’s option, at any time prior to March 31, 2006. www.cvps.com

<b>Goldner Hawn Johnson & Morrison</b> has sold <b>Claire-Sprayway Inc.</b> to <b>Plaze Inc.</b>, a portfolio company of <b>AEA Investors</b>. No financial terms were disclosed. Claire-Sprayway is an Addison, Ill.–based maker of branded and private-label cleaning agents, disinfectants, adhesives, insecticides and other products. Plaze is a St. Clair, Mo.-based packager serving niche segments within the aerosol packaging industry. Goldsmith Agio Helms advised GHJM on the deal. www.clairemfg.com www.plaze.com
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<b> PE-Backed IPOs</b>
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<b>Cbeyond Communications Inc.</b>, an Atlanta-based provider of managed IP-based communications services to small businesses in large metropolitan areas, priced around 6.13 million common shares at $12 per share, for an IPO take of approximately $73.59 million. Bank Securities served as lead underwriter. Cbeyond previously raised over $200 million in VC funding since its 1999 inception, from firms like VantagePoint Venture Partners, Battery Ventures, Cisco Systems, Madison Dearborn Partners, Metalmark Capital and Adams Street Partners. www.cbeyond.com

<b>Cynosure Inc.</b>, a Westford, Mass.-based developer of non-invasive aesthetic treatment systems to do such things as remove hair or treat vascular lesions, has set its proposed IPO terms to five million common shares being offered at between $12 and $14 per share. It plans to trade on the Nasdaq under ticker symbol CYNO, with Citigroup serving as lead underwriter. Cynosure is majority-owned by Italy-based <b>El.En SpA</b>, and also received under $1 million in VC funding in 1998 from the Boston University Community Technology Fund and Venham Ventures. www.cynosurelaser.com
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<b> PE-Backed M&A</b>
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<b>AtomShockwave Corp.</b>, a San Francisco-based online entertainment company, has acquired <b>AddictingGames</b>, a directory of popular online casual games. No financial terms were disclosed. AtomShockwave has raised over $60 million from such backers as Macromedia and Sequoia Capital. www.atomshockwave.com www.addictinggames.com
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<b> PIPEDeals</b>
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<b>MTI Technology Corp.</b> (Nasdaq SC: MTIC), an Irvine, Calif.–based provider of storage solutions and services, has raised $20 million in PIPE funding from <b>Advent International</b>. www.mti.com
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<b>PNC Mezzanine Capital</b> has closed its third fund with $350 million in capital commitments. Limited partners include PNC Financial Services Group, AlpInvest Partners, CIGNA Investment Management, New York Life Insurance Co., Rosetta Capital Partners, RWB/CapVent, VCM Capital Management GmbH and Woodland Partners. www.pncmezzanine.com

<b>Yellowstone Capital Partners</b>, a Houston, Texas-based merchant bank, has closed a $10 million venture capital fund focused on early-stage companies in the energy technology and renewable energy sectors. It is called Yellowstone Energy Ventures. www.yellowstonecapital.com
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<b> Human Resources</b>
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<b>Jack McCarthy</b> has joined <b>Alvarez & Marsal</b> as a New York-based managing director and co-head of the firm’s transactional advisory group, where he will lead due diligence teams that provide financial and operational assessments of investment opportunities for private equity clients. He previously served as a partner and managing director with <b>BA Capital Partners Europe</b>. www.alvarezandmarsal.com

<b>Gary Appel</b> has joined <b>Castle Harlan Inc.</b> as vice chairman. He is a founding partner of DLJ Merchant Banking, which he left in 1995. He since has served as a senior managing director with Bear Stearns & Co. and, most recently, as vice chairman of Chicago-based private equity firm <b>Glencoe Capital</b>. www.castleharlan.com

<b>Lola Miranda Hale</b> has joined <b>Epstein Becker & Green PC</b> as a member of the firm’s corporate and securities practice, where she will counsel of federal and state securities, M&A and corporate governance matters. She previously was a partner with Holland & Knight. www.ebglaw.com

<b>Glen Sato</b> has agreed to rejoin <b>Cooley Godward LLP</b> as a partner in the firm’s life sciences practice group, effective January 1. He had been serving as CFO of <b>Protein Design Labs</b>. www.cooley.com

<b>Eddie Conway</b> has joined <b>The Blackstone Group</b> as a managing director of <b>Blackstone Alternative Asset Management</b>, where he will lead U.S. marketing and distribution efforts. He previously served as an executive director of <b>Arden Asset Management Inc.</b> www.blackstone.com

No column today. Apologies.
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Top Three
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<b>Celleration Inc.</b>, an Eden Prairie, Minn.-based medical device company focused on chronic wound care, has raised $20.6 million in Series C funding. Triathlon Medical Ventures and New Science Ventures co-led the round, and were joined by Baird Venture Partners, CID Capital, Seneca Health Partners and return backers Affinity Ventures, Upper Lake Growth Capital, Prism, Venture Investors and AAVIN Equity Partners. www.celleration.com

<b>Friedman Fleischer & Lowe</b> and <b>Hellman & Friedman</b> have completed their joint acquisition of the <b>CATRisk</b> operation of <b>The</b> <b>St. Paul Travelers Companies Inc.</b> (NYSE: STA). CATRisk is a Fairfield, Calif.-based specialty property and casualty insurance company for non-admitted homeowners insurance in states like Florida and Texas, and for admitted residential earthquake insurance in California and Washington. Going forward, it will operate as <b>GeoVera Holdings Inc.</b> No financial terms of the acquisition were disclosed. www.geovera.com www.fflpartners.com www.hf.com

Website Pros Inc., a Jacksonville, Fla.-based provider of website development and consulting services for small and mid-sized businesses, priced 6.8 million common shares at $10 per share (middle of $9-$11 range), for an IPO take of approximately $68 million. Friedman Billings Ramsey served as lead book manager. The company has raised over $70 million in VC funding since its 1999 inception, with significant shareholders including Insight Venture Partners, Norwest Venture Partners and Crosspoint Venture Partners. www.websitepros.com
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</b><b>Associate Sought</b><b>

</b>Lineage Capital, a Boston-based middle-market private equity firm focused on family-controlled and owner-managed businesses is seeking an Associate to assist in all aspects of the investment process. Associates play a critical role in the evaluation, negotiation, structuring and monitoring of portfolio companies and work in small deal teams in an entrepreneurial environment. Pre- and post-MBA candidates are welcome to apply. www.lineagecap.com
<p class=”regtext1″ style=”MARGIN: auto 0in; TEXT-ALIGN: center” align=”center”><b>Please email cover letters and resumes to:
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</b>**Email only, please
<i>All submissions will be deemed highly confidential</i>
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</td></tr></tbody></table></div>

VC Deals
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<b>Viator Inc.</b>, a San Francisco-based provider of destination travel products, has raised $6 million in Series B funding. Carlyle Venture Partners led the deal, and was joined by return backer Technology Venture Partners. www.viator.com

<b>Fibromyalgia and Fatigue Centers Inc.</b>, a clinic-based healthcare company headquartered in Addison, Texas, has raised $4.5 million in venture funding from SSM Partners. The company previously had raised capital from Reservoir Partners and undisclosed angels, and currently operates 13 clinics. <u>www.fibroandfatigue.com</u>

<b>Trust Digital</b>, a McLean, Va.-based provider of enterprise mobile security software solutions, has raised $9 million in Series B funding. <b>BCE Capital</b> led the deal, and was joined by return backers Core Capital and Avansis Ventures. www.trustdigital.com
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Buyout Deals
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<b>Gores Technology Group</b> has completed its acquisition of <b>Avure Technologies Inc.</b> from <b>Flow International Corp.</b> (Nasdaq: FLOWE). The deal was valued at $15.3 million, with Flow International maintaining a commercial relationship with Avure, a provider of wire wound, high-pressure presses. www.gores.com www.flowcorp.com

<b>Summit Partners</b> has paid 39 million euros for a majority equity position in <b>Control Break International</b> (a.k.a. SafeBoot), a Netherlands-based developer of mobile data security and access control solutions. Sellers included <b>ABN Amro Capital</b>. www.summitpartners.com www.safeboot.com

<b>Sikorsky Aircraft Corp.</b>, a subsidiary of <b>United Technologies Corp.</b> (NYSE: UTX), has agreed to acquire <b>Keystone Ranger Holdings Inc.</b>, a West Chester, Pa.-based rotorcraft holding company. No financial terms were disclosed. Ranger shareholders include Meridian Venture Partners, Argosy Investment Partners, Brown Brothers Harriman and Spring Capital. www.keystonehelicopter.com

<b>Wachovia Capital Partners</b> has acquired <b>Randall Publishing Co.</b>, a Tuscaloosa, Ala.-based B2B media company serving the trucking and construction industries. No financial terms were disclosed. www.wachoviacapitalpartners.com www.randallpub.com

<b>EQT Partners</b> has hold <b>Bewator AB</b> to <b>Siemens</b> for an undisclosed amount. Bewator is a Solna, Sweden-based supplier of products and systems for access control solutions. www.bewator.se

<b>3i Group</b> has sold its minority stake in <b>William Wilson</b> to <b>Wolseley PLC</b> for Gbp81 million. William Wilson is a UK-based supplier of electrical, plumbing, heating and building products. www.3i.com www.williamwilson.co.uk

<b>Preferred Freezer Services Inc.</b>, a Newark, N.J.-based operator of refrigerated warehouses, has received an undisclosed amount of private equity funding from <b>TA Associates</b>. www.preferredfreezer.com www.ta.com
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PE-Backed IPOs
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<b>J. Crew Group Inc.</b>, a New York-based clothing retailer, has pushed off its proposed $200 million IPO until early 2006. It plans to trade on the NYSE under ticker symbol JCG, with Goldman Sachs and Bear Stearns serving as lead underwriters. <b>Texas Pacific Group</b> is J. Crew’s majority shareholder, based on a 1997 recapitalization. www.jcrew.com
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PE-Backed M&A
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<b>Otis Spunkmeyer Inc.</b>, a San Leandro, Calif.-based cookie company controlled by <b>Code, Hennessey & Simmons</b>, has acquired rival <b>Merkel McDonald Inc.</b> (a.k.a. Chippery), which makes frozen cookiedough and thaw-and-serve cookies. No financial terms were disclosed. Growth Capital Partners advised Merkel McDonald on the deal. www.spunkmeyer.com www.thechippery.com

<b>IBM</b> (NYSE: IBM) has acquired <b>iPhrase Systems Inc.</b>, a Bedford, Mass.-based provider of software designed to improve ecommerce sales, online service and support. No financial terms were disclosed. IPhrase has raised around $52 million in VC funding since its 1999 inception, from firms like Charles River Ventures, Greylock, Mayfield, Reed Elsevier Ventures, Sequoia Capital and FT Ventures. www.ibm.com www.iphrase.com

<b>MessageLabs Inc.</b>, a New York–based provider of enterprise messaging security and management services, has agreed to acquire <b>Omnipod Inc.</b>, a New York-based provider of enterprise instant messaging services. No financial terms were disclosed. Omnipod has raised $8.9 million in VC funding from firms like Lexington Ventures and Mapleton Investments. www.messagelabs.com www.omnipod.com

<b>DNAPrint Genomics Inc.</b> (OTC BB: DNAG) has acquired <b>Kenna Technologies Inc.</b>, a West Chester, Pa.-based builder of computer models that mimic complex biological systems. Under terms of the deal, Kenna shareholders like MedInnova Partners exchanged all of the company’s outstanding common shares for 1.5 million shares of DNAPrint Genomics common stock. www.dnaprint.com www.kennatechnologies.com

<b>DOR BioPharma Inc.</b> (AMEX: DOR) has agreed to acquire <b>Gastrotech Pharma AS</b>, a Danish developer of therapeutics based on peptide hormones, for the treatment of cancer and gastrointestinal diseases. The deal includes up to $13.5 million worth of DOR stock, plus the possibility of an additional $30 million in milestone-based payments. Gastrotech has raised VC funding from Nordic Capital. www.dorbiopharm.com www.gastrotechpharma.com

<b>Surgient Networks Inc.</b>, an Austin, Texas-based provider of self-service applications for software demo, test and training lab automation, has agreed to acquire <b>Runaware AB</b>, a Sweden-based provider of software evaluation services. No financial terms were disclosed. Surgient has raised over $85 million in VC funding from firms like Austin Ventures, BlueStream Ventures, Seaport Capital, Sternhill Partners and MFI Austin. Runaware has raised VC funding from CapMan Capital Management and Priveq Partners. www.surgient.com www.runaware.com
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Firm & Fund News
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<b>Edwards & Angell LLP</b> has completed its merger with <b>Palmer & Dodge LLP</b>, with the resulting law firm named Edwards Angell Palmer & Dodge LLP. www.eapdlaw.com
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Human Resources
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<b>Rich Gammill</b> has joined <b>ARC Investment Partners</b> as managing director of transaction execution, responsible for overseeing the firm’s Merger IPO transactions. He previously served as a principal with DynaFund Ventures and, before that, as director of business development for Sabre Inc. www.arcinvestmentpartners.com

<b>Peter Pintar</b> has joined <b>Smith International Inc.</b> (NYSE: SII) as vice president of corporate strategy and business development, and also will oversee M&A activities. He previously worked with <b>DTE Energy</b> (NYSE: DTEPRB), where his responsibilities included oversight of a venture capital fund focused on the energy technology sector. www.smith.com

<b>Bert van Toor</b> has joined Swiss venture firm <b>BioMedInvest</b> as a partner. He previously served as a principal with <b>Global Life Sciences Ventures</b>. www.biomedinvest.ch

<b>John Sheridan</b> has joined the Chicago office of <b>Corporate Finance Associates</b> as a managing director. He previously was with <b>Premier Business Group Ltd.</b> www.cfachicago.com

<b>Just Linking Around</b>

Greetings from San Francisco, where the sun has finally come up and my luggage has finally arrived (American Airlines had some major problems in that regard yesterday). Anyway, just a couple of links while I settle into my temporary hilltop digs …

*** Bill Burnham questions the conventional wisdom of persistent VC returns, or the notion that a general partner’s past returns are the best indicator of its future returns. Speaking of VC returns, the National Venture Capital Association and Thomson Venture Economics have released new figures that can be found here.

*** Why outsource offshore when there is an aging class of American baby boomers with time on their hands? Steve Jurvetson makes the case.

*** Scott Maxwell of Insight Venture Partners has started a blog. So has Peter Rip of Leapfrog Ventures.

*** Seth Levine asks VCs if they tell entrepreneurs the real reason for saying no.
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<b>FAMILY BUSINESS OWNERS</b>:
Join our family business seminar today in <b>San Francisco</b> to find out what private equity firms are looking for in an acquisition and how you can get your company ready for sale. Moderated by family business expert Michael O’Malley, qualified family business owners can attend this valuable 90-minute seminar, plus a wine tasting that night, for just $75. To find out if you qualify for this offer, please email Ingrid Olsen at Ingrid.olsen@thomson.com with the word “Family” in the subject line.

For more information on the conference please
go to www.buyouts-symposium.com.
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<b> Top Three</b>
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Dynegy Inc. (NYSE: DYN) has completed the sale of its midstream natural gas business to <b>Targa Resources Inc.</b>, a Houston, Texas–based midstream energy company formed in 2003 by company management and <b>Warburg Pincus</b>. The deal is valued at $2.445 billion, including $2.35 billion in cash and the assumption of $47 million in letters of credit provided by Dynegy for the midstream business. www.targaresources.com www.dynegy.com

Adelphia Communications Corp. and <b>ML Media Partners</b> have completed the sale of their jointly-owned cable operations in San Juan, Puerto Rico to <b>MidOcean Partners</b> and <b>Crestview Partners</b>. The deal was originally valued at $520 million, with AlpInvest and Northwestern Mutual also co-investing. The system serves 137,000 customers. www.midoceanpartners.com

Local Matters Inc., a Denver-based provider of outsourced search solutions to the yellow pages market, has raised $20 million in private equity funding from <b>Sandler Capital Management</b>. SG Cowen served as placement agent. www.localmatters.com
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</b>**Email only, please
<i>All submissions will be deemed highly confidential</i>
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<b> VC Deals</b>
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<b>SpineMedica Corp.</b>, a Florida-based medical device company developing an artificial spinal disc implant, has raised $10.6 million in Series A funding. Backers include FCA Venture Partners (managed by Clayton Associates), the Trelys Funds and A/B Partners (managed by Archbrook Capital Management). www.spinemedica.com

<b>AM-Pharma BV</b>, a Dutch drug company focused on infectious and inflammatory diseases, has raised 9 million euros from <b>Inventages Venture Capital</b> (6 million euros) and <b>ABN Amro Life Sciences Capital</b> (3 million euros). www.am-pharma.com

<b>Revver Inc.</b>, a Los Angeles-based provider of revenue engine solutions for online video, has raised an undisclosed amount of Series A funding from Bessemer Venture Partners, Draper Richards and Draper Fisher Jurvetson. www.revver.com

<b>Vital Therapies Inc.</b>, a San Diego-based liver therapy company, has raised $8 million in a first close to the company’s Series B funding round. <b>MedVenture Associates</b> led the deal, and was joined by Valley Ventures, Paragon Venture Partners, Toucan Capital and several unnamed individuals. www.vitaltherapies.com

<b>TestQuest Inc.</b>, a Minneapolis-based provider of automated testing solutions for the mobile and wireless industry, has raised $7.5 million in new VC funding. <b>Gabriel Venture Partners</b> led by deal, and was joined by return backers like Norwest Venture Partners and Needham Capital Partners. The company has raised approximately $40 million in total VC funding since its 1993 inception. www.testquest.com

<b>Tenrox</b>, a Pasadena, Calif.-based provider of operational control and compliance software, has raised $4.6 million in VC funding from <b>Novacap</b>. www.tenrox.com

<b>Continuent</b> (f.k.a. Emic Networks), an Emeryville, Calif.-based provider of commercial open-source middleware solutions for database high availability, has raised $5.75 million in Series B funding. Participants included Trident Capital, Nordic Venture Partners and Ledstiernan. www.continuent.com

<b>OpenLogic Inc.</b>, a Broomfield, Colo.-based provider of software tools for open source-based software development, has raised an undisclosed amount of additional Series A funding from UV Partners. The company previously held a $4 million first close at a post-money valuation of $11.3 million, from backers like Appian Ventures, Highway 12 Ventures, Red Rock Ventures and Village Ventures. In other OpenLogic news, the company has named Steven Grandchamp as its president and CEO. He most recently served as president and CEO of Information Management Research. www.openlogic.com
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<b> Buyout Deals</b>
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<b>Greenbriar Equity Group</b> and <b>Vestar Capital Partners</b> have sponsored a management buyout of <b>AT Holdings Corp.</b>, the parent company of <b>Argo-Tech Corp.</b>, a Cleveland–based maker of fuel flow devices and systems for aerospace and general industrial applications. No financial terms were disclosed. www.argo-tech.com

<b>Waterland Private Equity Investments</b> and <b>Prime</b> <b>Technology Ventures</b> have co-sponsored a management buyout of Netherlands-based GlobalCollect from logistics company <b>TNT</b> (AEX: TNT). No financial terms were disclosed. GlobalConnect is an international electronic payment processor for Internet and direct marketing transactions. It has offices in the Netherlands and San Francisco. www.globalconnect.com www.waterland.nu www.ptv.com
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<b> PE-Backed IPOs</b>
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<b>Cbeyond Communications Inc.</b>, an Atlanta-based provider of managed IP-based communications services to small businesses in large metropolitan areas, has reduced its proposed IPO terms for the second time in as many days. It now plans to sell around 6.12 million common shares at between $12 and $13 per share. It originally had filed to sell approximately 6.06 million common shares offered at between $16 and $18 per share, and later reduced those terms to 6.1 million shares at between $13 and $14 per share. Bank Securities is serving as lead underwriter (JPMorgan had been listed on the original S-1, but is not listed in the amended S-1as). Cbeyond has raised over $200 million in VC funding since its 1999 inception, with significant shareholders including VantagePoint Venture Partners, Battery Ventures, Cisco Systems, Madison Dearborn Partners, Metalmark Capital and Adams Street Partners. www.cbeyond.com

<b>Amerisafe Inc.</b>, a DeRidder, La.-based provider of workers’ compensation insurance for small-to-mid-sized employers engaged in hazardous industries, has set its proposed IPO terms to 8 million common shares being offered at between $9 and $11 per share. It plans to trade on the Nasdaq under ticker symbol AMSF, with Friedman, Billings Ramsay and William Blair & Co. serving as lead underwriters. Shareholders include Welsh Carson Anderson & Stowe, Abbott Capital, Sprout Group, Teachers Annuity Association of America, Northwestern Mutual Life Insurance Co. and Jackson National Life Insurance Co. www.amerisafe.com
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<b> PE-Backed M&A</b>
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<b>Bell Automotive Products Inc.</b>, a Scottsdale, Ariz.–based supplier of automotive convenience accessories, has acquired <b>Victor Products</b> from <b>Barjan Products LLC</b>. No financial terms were disclosed for the deal, which included senior debt financing from Harris Trust and Savings Bank, plus subordinated note financing from Harris Nesbitt Capital. Victor Products is based in Des Plaines, Ill., and produces such items as tire repair kits, gauges and sealants. Bell Automotive is owned by private equity firm <b>JH Partners</b>. www.bellautomotive.com

<b>Cognitronics Corp.</b> (AMEX: CGN) has agreed to acquire <b>ThinkEngine Networks Inc.</b>, a Marlborough, Mass.–based provider of VoIP solutions. The deal is valued at approximately $4.7 million in cash, stock and notes, and is expected to close by year-end. ThinkEngine Networks has raised over $25 million in VC funding since its 2000 inception, from firms like <b>Prism Venture Partners</b> and <b>VantagePoint Venture Partners</b>. www.cognitronics.com www.thinkengine.com

<b>NightHawk Radiology Holdings Inc.</b>, a Coeur d’Alene, Idaho-based provider of nighttime and weekend emergency radiology services to radiology groups and hospitals, has acquired <b>American Teleradiology Nighthawks Inc.</b>, a Va.-based provider of overnight and off-hours tele-radiology services. No financial terms were disclosed. Nighthawk Radiology is a portfolio company of <b>Summit Partners</b>. www.nighthawkrad.net
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<b>Marlin Equity Partners</b> of El Segundo, Calif. has closed its inaugural private equity fund, which will focus on special situations in the small and middle markets across a variety of industries.<b>David McGovern</b> founded Marlin in 2005 after spending six years as head of M&A at Gores Technology Group.He is joined by <b>Nick Kaiser</b> and <b>P.J. Nachman</b>, both of whom worked with McGovern while at Gores. www.marlinequity.com

<b>Warburg Pincus</b> has entered into a strategic cooperation agreement with <b>Raycom Real Estate Development Co.</b>, the real estate arm of Legend Holdings Ltd. The deal focuses on real estate projects in China, and initially involves Warburg Pincus investing $31 million into projects that Raycom is currently developing, including a large mid-end residential development in northeastern Beijing. www.warburgpincus.com www.raycompark.com
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<b> Human Resources</b>
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<b>Sean Epp</b> has been named vice president of originations with <b>GE Commercial Finance Corporate Lending</b>. He will be based in the firm’s Minneapolis office, and previously was with Headwaters Capital. www.gelending.com

<b>Charles Goldenberg</b> has joined <b>Mercer Management Consulting</b> as a director in the firm’s communications, information and entertainment practice. He previously was with Deloitte Consulting. www.mercermc.com

<b>Monday Mouth-Off</b>

The Halloween sky is bright, J.C. Flowers reportedly remains interested in Refco and I’ve got to hop a plane to San Fran for the Buyouts Symposium West. In other words, it’s time for some Monday Mouth-Off.

First up are some notes on the Web 2.0 hype, which I succumbed to by asking for your participation in our Frappr-enabled PE Week Wire Map. Joshua writes: “I don’t really buy into the ‘Google is going to buy me’ idea that a lot of Web 2.0 folks seem to have. Yahoo might buy you, but Google has hundreds of really smart people… and they are probably already working on whatever it is you are wanting to eventually sell to them. For instance, a new Web 2.0 web browser is a cool idea, but I think Google is a step ahead.” Randy adds: “Entrepreneurs are treating Google and Yahoo like the Nasdaq of 1998-2000. The big difference is that Google and Yahoo only need one of everything, while the bubble-era Nasdaq was willing to take two, three and sometimes four of everything. If this is a bubble, it will be inflated by the VCs who overestimate what Google and Yahoo will buy, not the other way around.”

Then there is N, who opines: “Have you figured out the revenue model of all of these Web 2.0 consumer businesses? Customer acquisition at any cost (i.e., not charging for your product) seems awfully familiar. Oh yeah … we did that back in 2000. I was at the Early Stage Venture conference last week and confirmed that, for good reason, the VC community generally won’t fund consumer businesses that don’t have a critical mass of customers. How then does an early-stage Web 2.0 company get funding? Easy: Bootstrap the offshore development of a great product and then give it away for free. Get customers … get funding. Are we structurally rewarding unsustainable business models?” Ummm… yes. By the way, Colette wrote on our Frappr map that the PE Week Wire is the People Magazine of private equity. Is that a good thing? Been trying to figure it out all morning….

Paul replies to Friday’s note about the perceived rise in I-bankers leaking their auction info: “As an M&A banker for a small boutique, leaking anything has the potential to kill deals. We don’t work by the hour like lawyers do, nor do we get paid for AUM, we get paid for completing deals, and that does not involve leaking confidential details of our clients…. Leaks most often come from people who have received the books but will not bid.Most likely from a quasi-competitor who actually has something to gain by the leak. By the way I-bankers seem to be a favorite target lately.While things are going well now, there were years that we worked on several transactions that resulted in a zero payday. The way to think about I-banking pay is like a farmer who has a bumper crop because of good rain.The next year he may just as likely experience a drought. To really know what we get paid follow an entire boom-bust cycle.You’ll find life isn’t so easy.”

Finally, Steven writes: “How about some recognition to the 2005 World Series Champion Sox, even if they are white and not red?” Recognized… Hope to see a bunch of you in San Fran tomorrow. I’ll stay on East Coast time, so the PE Week Wire will be published at its normal time.
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<b>FAMILY BUSINESS OWNERS</b>:
Join our family business seminar next <b>Tuesday, Nov. 1</b> , in <b>San Francisco</b> to find out what private equity firms are looking for in an acquisition and how you can get your company ready for sale. Moderated by family business expert Michael O’Malley, qualified family business owners can attend this valuable 90-minute seminar, plus a wine tasting that night, for just $75. To find out if you qualify for this offer, please email Ingrid Olsen at Ingrid.olsen@thomson.com with the word “Family” in the subject line.

For more information on the conference please
go to www.buyouts-symposium.com.
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<b> Top Three</b>
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<b>Susquehanna Pfaltzgraff Co.</b> has agreed to sell Susquehanna Radio to <b>Cumulus Media Inc.</b> (Nasdaq: CMLS), <b>Bain Capital</b>, <b>Blackstone Group</b> and <b>Thomas H. Lee Partners</b>. The deal is valued at approximately $1.2 billion, and is expected to close in the first half of 2006. Debt financing for the transaction is being provided by Deutsche Bank, Merrill Lynch, Goldman Sachs and UBS. Susquehanna Radio is the largest privately-owned radio broadcasting company in the U.S., with 33 stations in eight markets. In other Susquehanna Pfaltzgraff news, the company has agreed to sell its cable television and broadband services division to <b>Comcast Corp.</b> www.suspfz.com www.cumulus.com

<b>Surface Logix Inc.</b>, a Boston-based developer of drug optimization programs, recently held a $20 million third close on its $42 million Series C funding round. The company held earlier closes of $4 million (April) and $8 million (September), bringing its total call-down to $32 million. Return participants include Venrock Associates, Arch Venture Partners, CW Group, HBM Partners, TIAA-CREF, Healthcare Focus Fund, Intel Capital and Unilever Technology Ventures. www.surfacelogix.com

<b>Kohlberg Kravis Roberts & Co.</b> and <b>Silver Lake Partners</b> have agreed to sell the storage semiconductor business of <b>Agilent Technologies Inc.</b> (NYSE: A) to <b>PMC-Sierra Inc.</b> (Nasdaq: PMCS), once the two firms complete their previously-announced acquisition of Agilent’s overall semiconductor products group. The sale to PMC is worth approximately $425 million in cash, while KKR and Silver Lake’s buyout of the entire semiconductor products group is valued at approximately $2.66 billion. www.agilent.com www.kkr.com www.silverlake.com www.pmc-sierra.com
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</b>**Email only, please
<i>All submissions will be deemed highly confidential</i>
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<b> VC Deals</b>
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<b>H5 Technologies Inc.</b>, a San Francisco-based provider of information discovery, analytic and corporate content risk management solutions, has raised $15 million in Series C funding co-led by <b>Institutional Venture Partners</b> and <b>WaldenVC</b>. The company has raised $32 million in total VC funding since its 1999 inception, including $6.5 million in Series B funding from Draper Fisher Jurvetson. www.h5technologies.com

<b>TransOral Pharmaceuticals Inc.</b>, a San Rafael, Calif.-based drug company focused on sleep and migraine therapeuties, has raised $23 million in Series C funding. New Leaf Venture Partners led the deal, and was joined by InterWest Partners and return backers Montreux Equity Partners, Hamilton BioVentures, Vivo Ventures and Peninsula Equity Partners. www.transoral.com

<b>CloudShield Technologies Inc.</b>, a Sunnyvale, Calif.-based provider of deep packet inspection platforms, has raised $10 million in fourth-round funding. Return backers included TPG Ventures, ComVentures, Foundation Capital and Paladin Capital. www.cloudshield.com

<b>Digg Inc.</b>, a San Francisco-based social content website operator, has raised $2.8 million in first-round funding. <b>Greylock Partners</b> and <b>Omidyar Network</b> co-led the deal, and were joined by angel backers like Marc Andreessen, Reid Hoffman, Ron Conway, Mike Maples, Jr. and Al Avery. www.digg.com

<b>Akimbi Systems Inc.</b>, a San Mateo, Calif.-based developer of infrastructure management solutions for use in software development and test organizations, has raised $8 million in Series B funding, according to a regulatory filing. <b>Mayfield</b> led the deal, and was joined by return backers like Hummer Winblad Venture Partners and Partech International. www.akimbi.com

<b>Vycon Inc.</b>, a Cerritos, Calif.-based maker of flywheel systems, has raised $2.5 million in Series A funding, according to a regulatory filing. Company shareholders include BankInvest, RWE Dynamics Venture Capital Management, Sumitomo Corp., Cooper Capital Partners and Tridus International. www.vyconenergy.com

CropSolution Inc., a Morrisville, N.C. maker of agro-chemicals for crop protection, has raised $2.9 million in Series C funding, according to a regulatory filing. Company shareholders include The Aurora Funds and ATP Capital. www.cropsolution.com

<b>Tethys Bioscience Inc.</b>, an Emeryville, Calif.-based drug company that utilizes biomarkers, has raised $5.35 million in Series A funding, according to a regulatory filing. <b>Mohr, Davidow Ventures</b> led by deal. www.tethysbio.com

<b>Xambala Inc.</b>, a San Jose, Calif.-based developer of “semantic processor” solutions, has raised $5.5 million in Series B funding, according to a regulatory filing. Return backers include TeleSoft Partners, Mohr, Davidow Ventures and Jafco Ventures. www.xambala.com

<b>AssistGuide Inc.</b>, a Kailua, Hawaii-based provider of an information network for people needing senior, long-term care and disability services, has raised an undisclosed amount of Series B funding. <b>Palo Alto Venture Partners</b> led the deal, and was joined by Advantage Capital Partners and return backers Start-Up Capital Ventures and the International Venture Fund. www.assistguide.com
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<b> Buyout Deals</b>
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<b>Register.com Inc.</b> (Nasdaq: RCOM) shareholders has approved a $7.81 per share acquisition proposal from <b>Vector Capital</b>. The total deal is valued at approximately $200 million, and is expected to close early next month. www.vectorcapital.com www.register.com

<b>J.C. Flowers & Co. LLC</b> has completed its acquisition of <b>Crump Group</b> <b>Inc.</b>, the U.S.-based wholesale broking operation of <b>Marsh Inc.</b>, a unit of <b>Marsh & McLennan Cos.</b> (NYSE: MMC). No financial terms were disclosed. Banc of America Securities served as financial advisor to Marsh, while Lazard served in a similar capacity for J.C. Flowers. www.marsh.com

<b>Bridgepoint</b> has agreed to acquire <b>Environmental Resources Management PLC</b>, a UK–based provider of environmental consulting services. The deal is valued at $535 million, and includes the 52% stake owned by <b>3i Group</b> and the 48% stake held by ERM’s 400 employee shareholders. It is expected to close in December, and would be Bridgepoint’s first transaction out of the 2.5 billion euros third fund it raised earlier this year. www.bridgepoint-capital.com www.erm.com

<b>BNY Capital Markets Inc.</b> has arranged a $282 million debt recapitalization for <b>Patriot Media and Communications CNJ LLC,</b> a Greenwich, Conn.-based cable television high-speed Internet services provider formed in 2002 by Steven Simmons and <b>Spectrum Equity Investors</b>. The recap includes a $25 million seven-year revolver, a $210 million seven-and-a half-year Term Loan B and a $47 million eight-year second lien term loan. Part of the recap proceeds will go to Spectrum. www.patmedia.net
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<b> PE-Backed IPOs</b>
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<b>Accentia Biopharmaceuticals Inc.</b>, a Tampa, Fla.-based drug company focused on respiratory disease and oncology, priced 2.4 million common shares at $8 per share, for an IPO take of approximately $19.2 million. The company originally planned to offer 6.25 million common shares at between $11 and $13 per share, but later reduced the terms to 2.5 million shares at between $8 and $10 per share. Jefferies & Co. served as lead underwriter, while significant shareholders include The Hopkins Capital Group, McKesson Corp. and Pharmaceutical Product Development Inc. www.accentia.net

<b>IntraLinks Inc.</b>, a New York-based provider of online secure workspaces, has set its proposed IPO terms to 4 million common shares being offered at between $14 and $16 per share. It plans to trade on the Nasdaq under ticker symbol ILNX, with JPMorgan and UBS serving as lead underwriters. Significant shareholders include Rho Ventures (32.8% pre-IPO stake), TowerBrook Investors (20.5%), Reuters (11.8%), Apax Partners (9.3%) and Canaan Partners (6.1%). www.intralinks.com

<b>Linn Energy LLC</b>, a Pittsburgh, Pa.-based natural gas company, has raised its proposed IPO terms to 11.75 million common units being offered at between $19 and $21 per unit. It previously was planned to offer 8.7 million units. RBC Capital Markets and Lehman Brothers are serving as lead underwriters, while <b>Quantum Energy Partners</b> is a significant shareholder. www.linnenergy.com
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<b>Prologue Technology Entrepreneurship</b> has launched as a seed capital group focused on nanotechnology. It has offices in Israel and Silicon Valley, and is funded by <b>Pitango Venture Capital</b>. www.prologue.co.il

<b>Cambridge Associates</b> has opened a new office in Dallas, Texas. www.cambridgeassociates.com

Panorama Capital has begun pre-marketing for its first independent fund, as first reported in this space last month.
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<b> Human Resources</b>
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<b>Gordon Holmes</b> will join <b>Quadrangle Group</b> as a managing principal, effective November 21. He most recently served as a general partner with <b>Forstmann Little & Co.</b>, where he worked closely on deals for companies like Citadel Broadcasting Corp. and 24 Hour Fitness. www.quadranglegroup.com

<b>Kari-Pekka Wilska</b> has joined <b>Austin Ventures</b> as a venture partner. “K-P” recently retired from his post a president with <b>Nokia Inc.</b>, after spending more than 30 years in various positions within the company. www.austinventures.com

<b>Pål Reed</b> has joined <b>HitecVision Private Equity AS</b> as a partner. www.hitecvision.com

<b>CMEA Ventures</b> has promoted <b>Rob McIntyre</b> from associate to partner. He will continue to focus on opportunities in the nanotech, solar power, RF systems, wireless communications, consumer electronics and digital media spaces. Prior to joining CMEA, McIntyre spent three years with H.I.G. Capital. www.cmeaventures.com

<b>Jim Toohey</b> has joined M&A-focused I-bank <b>Petsky Prunier LLC</b> as a vice president. He most recently served as CFO of direct marketing company <b>CC3</b>. www.petskyprunier.com

<b>Jeffrey Long</b> has joined <b>Vestar Capital Partners</b> as a managing director in the firm’s Vestar Resources group. He has spent the past 12 years with <b>McKinsey & Co.</b> www.vestarcapital.com

<b>HarbourVest Partners</b> has promoted <b>Peter Lipson</b>, <b>Alex Rogers</b> and <b>John Toomey</b> to the position of principal. It also promoted <b>Corentin du Roy</b> and <b>Amanda Outerbridge</b> to associate. www.harbourvest.com

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