PE Week Wire — Friday, June 4

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Rick Hayes has tendered his resignation as senior investment officer for alternative assets with the California Public Employees’ Retirement System (CalPERS), effective in July. He will become a managing partner at Oak Hill Capital Management. Go to for more.

David Mills has been named executive director of the $61.2 billion Wisconsin State Investment Board (SWIB). He had been serving as acting director since December, and had previously served as deputy secretary and chief operating officer of the Department of Employee Trust Funds. Mills beat out Donald McDonald, former executive vice president and chief investment officer for Conning Asset Management. Heidrick and Struggles had been retained to conduct the search, following the retirement of 14-year SWIB veteran Peggy Lipton.

Inhibitex Inc., an Alpharetta, Ga.-based provider of antibody-based products for the prevention and treatment of bacterial and fungal infections in hospitals, will begin trading on the Nasdaq under ticker symbol INHXl. The company priced million five million shares of common stock at $7 per share, for a total IPO take of approximately $35 million. The company had originally hoped to price 5.9 million shares at between $10-$12 per share. Significant shareholders include New Enterprise Associates, Alliance Technology Ventures, William Blair Capital Partners, Essex Woodlands Health Ventures, Capital Technologies CDPQ Inc. and Burrill & Co. The company also replaced lead underwriter US Bancorp Piper Jaffray with Thomas Weisel Partners.


Pay By Touch Inc., a San Francisco-based provider of biometric authentication and payment solutions, has held a $25 million soft close for an ongoing round of Series B funding. Mobius Venture Capital led the initial tranche, and was joined by the Gordon P. Getty Family Trust and private investors. The company now has raised $37 million in total VC funding since being formed via a June 2003 merger of Solidus Networks and Indivos Corp.

TrestleTree Inc., a Fayetteville, Ark.-based company focused on reducing healthcare costs, has raised $4 million in Series B funding. Diamond State Ventures led the deal, and was joined by Delta Capital Management (a $1 million investment) and a pair of family-related groups.


Advent International has acquired Tillimpa SA, a Brazilian laundry company. No deal terms were disclosed. This is Advent’s fourth Latin American investment in as many months, and is being made through Central Lav, an Advent-controlled company focused on laundry outsourcing. No deal terms were disclosed.


Henderson Private Capital has sponsored a management buyout of the RedeCam Group, a Milan, Italy-based filtration company. No deal terms were disclosed.


Hemophilia Health Services Inc., a wholly-owned subdidiary of Accredo Health Inc. (Nasdaq: ACDO) has agreed to acquire 100% of HRA Holding Corp. and its wholly-owned subsidiary Hemophilia Resources of America Inc. The deal is expected to close in early September, pending regulatory approval. No financial terms were disclosed. HRA is a Pine Brook, N.J.-based company that received private equity funding in 1999 from Summit Partners. 


Jon Lemelman has joined Riverside Partners as a principal. He most recently worked with Fidelity Strategic Investments, the private equity division of Fidelity Investments.


SSA Global Technologies Inc., a Chicago-based provider of enterprise application software, has filed to raise $200 million via an IPO of common stock on the Nasdaq under proposed ticker symbol SSAG. The company was formed in 2000 to acquire the assets of bankrupt company System Software Associates Inc. It has since acquired such companies as Infinium Software Inc., Ironside Technologies Inc., Elevon Inc. and EXE Technologies Inc. It is controlled by private equity firms General Atlantic Partners and Cerberus Capital Management.


Metabasis Therapeutics Inc., a San Diego-based biotech company focused on the treatment of liver and liver-related metabolic diseases, has reduced its IPO offering price range from $11-$13 per share to $8-$9 per share. The company also reduced its proposed number of offered shares from six million to five million. The company has raised around $65 million in venture capital funding from firms like MPM Capital, InterWest Partners, Sprout Group, Maverick Capital, Wellcome Trust, Itochu Corp. and Pan-Pacific Venture Capital.


Archipelago Holdings LLC, a Chicago-based electronic stock exchange operator, has set its number of common shared to be offered via IPO to 8,695,653. The estimated offering price remains at $15 per share. Last December, the company received a $125 million private equity investment from General Atlantic Partners. General Atlantic and Goldman Sachs (which is lead underwriting the IPO) are Archipelago’s largest shareholders.


Joel Cohen and Hal Ritch, former co-heads of global M&A for Donaldson, Luftkin & Jenrette, have formed Sagent Advisors Inc., a New York-based financial advisory focused on M&A counsel. Joining Cohen, chairman and co-CEO, and Ritch, president and co-CEO, are managing directors: Price Blackford, former managing director of I-banking with CSFB; Doug Brown, former managing director in the M&A group of CSFB; Erik Jensen, former managing director with Lane Berry & Co.; Martin Murrer, former managing director and head of middle market M&A with Merrill Lynch; Nils Nilsen, former managing director with Bear Stearns; David Platter, former senior managing director of the global institutions group at Bear Stearns; and Joseph Rowan, former managing director in the corporate finance and structured finance groups of KPMG. Also joining Sagent as chief administrative officer is Scott Kaplan, formerly a director of I-banking with UBS.


Intermex Wire Transfer Inc., a Miami, Fla.-based remittance company, has received a $2.5 million subordinated debt investment from Banyan Mezzanine Fund.



 News from Thursday 6/3

The California State Teachers’ Retirement System (CalSTRS) has scaled back an ambitious plan to create an international private equity portfolio that reached from the Far East to Latin America. Instead, CalSTRS decided yesterday to only add Australia and Japan to an international program that already includes Canada and Western Europe. In other CalSTRS news, the pension system has again selected Pension Consulting Alliance Inc. as its general consultant to assist with oversight of the investment portfolio. The firm was awarded a five-year contract after the CalSTRS Investment Committee listened to presentations from three finalist firms. Allan Emkin, a managing director with PCA, has been CalSTRS’ general investment consultant for the last 19 years.

Noveon International Inc., a Cleveland-based provider of specialty chemicals, has withdrawn its $345 million IPO offering. The move comes after The Lubrizol Corp. (NYSE: LZ) agreed to acquire Noveon for $920.2 million in cash. Noveon was created in February 2001 by AEA Investors, DLJ Merchant Banking and MidOcean Capital to acquire the Performance Materials division of Goodrich Corp. It filed for a $345 million IPO three months ago.

CHAMP, the Australian affiliate of Castle Harlan, has sold Penrice Soda Products Pty. Ltd. to Australian private equity firms Quadrant Capital, an affiliate of Westpac Private Equity, and funds associated with Colonial First State Private Equity Ltd. Penrice is an Adelaide, Australia-based manufacturer of soda ash and baking soda, and is being acquired for Au$110 million (approx. US$78 million). CHAMP originally acquired the company in November 2001 for Au$80 million. National Australia Bank underwrote the deal’s debt financing, which CHAMP was advised by Credit Suisse First Boston.


The Riverside Co. has sold Production Control Services Inc. to Fidelity Capital Investors. No specific deal terms were disclosed, although Riverside did say that the deal generated a gross IRR of 35.5%, and 3.2X gross cash-on-cash returns. PCS is a Fort Lupton, Colo.-based provider of plunger lift systems and equipment for natural gas producers. Riverside acquired the company from its founders in October 2000.

Datang Telecom Technology Co. Ltd., a state-owned telecom equipment maker China, has agreed to receive a $70 million investment from Warburg Pincus, according to various press reports. Most of the deal is structured as convertible debt, and will give Warburg a stake in Datang Telecom semiconductor subsidiary Datang Microelectronics.


V.I. Technologies Inc. (Nasdaq: VITX) has agreed to merge with Gaithersburg, Md.-based Panacos Pharmaceuticals Inc., a privately-held biotech company focused on antiviral drugs for the treatment of HIV infections. As part of the deal, Vitex will issue 25 million common shares, plus an additional 20 million common shares upon the completion of certain clinical milestones. Vitex common stock closed yesterday at $1.08 per share, which gives the total deal a current value of $48.6, assuming that the clinical milestones are met ($27 million if they are not). Panacos has raised $26.6 million in VC funding since its 2000 inception, with investors including A.M. Pappas & Associates, Ampersand Ventures, the Maryland Department of Business & Economic Development, Mitsui & Co., New England Partners, Novo AS and William Harris Associates.


Frank Fernandez has left his senior portfolio manager post with the Florida State Board of Administration, according to His new job will be as a partner with Alignment Capital, an Austin, Texas-based private equity consultant in the early stages of raising a $300 million fund-of-funds.

Fidelity Ventures has added two professionals to its business development team. The first is Jill Roosevelt as senior vice president for business development. She originally joined Fidelity in 1996, and most recently served as senior vice president for Fidelity Investments Systems Co. Fidelity Ventures also added Stephen Jenvey as an associate. He most recently served as senior technology director for the Center for Applied Technology at Fidelity Investments.

Frank Wood, CEO of Secret Communications LLC and co-founder of The Darwin Group, has joined the board of directors at Rewards Network Inc. (AMEX: IRN).

Joseph Ruffalo and Laurie Shahon have been named independent directors with Kitty Hawk Inc. (OTC BB: KTHK). Ruffalo is co-founder of Ruffalo Benson LLC, a provider of capital for management buyouts and recaps of under-performing companies. Shahon is president of private equity firm Wilton Capital Group.

Brooke Seawell, a venture partner with Technology Crossover Ventures, has joined the board of directors at CoWare Inc., a San Jose, Calif.-based provider of EDA software and services.


Color Kinetics Inc., a Boston-based developer of solid-stage illumination technologies, has set its IPO offering price range to $11-$13 per share, and its total number of offered shares to four million. The company has raised over $47 million in total VC funding since its 1997 inception, including a $13 million Series D round earlier this year. Investors have included Needham Capital Partners, Armen Capital Management, ThinkEquity Investment Partners, SAC Capital Advisors and Deutsche Bank.

Halfords Ltd., a Redditch, UK-based car-parts and bicycle retailer, will begin trading on the London Stock Exchange today, after floating yesterday with a company value of around 604 million British pounds (approx. $1.1 billion). The company was acquired in 2002 by CVC Capital Partners for approximately 427 million British pounds.


The Pennsylvania Public School Employees’ Retirement System (PSERS) reported one-year investment returns for the time period ending March 31, 2004. The entire system’s return on investments was 33.27 percent. As of March 31, PSERS had approximately 9.3% of its assets in alternative investments. Those assets had a one-year return of 17.36%, a three-year return of -0.22% and a five-year return of 4.94 percent.


 News from Wednesday 6/2


Norwest Mezzanine Partners has closed its second fund with $400 million. The Minneapolis-based group is affiliated with Norwest Equity Partners, which expects to close on an $800 million private equity fund in September. Both funds will feature Wells Fargo as their sole limited partner.

SyChip Inc., a Plano, Texas-based provider of RF-CSM for the wireless market, has raised $20 million in fourth-round VC funding. Austin Ventures led the deal, and was joined by fellow return backers 3i US, Alliance Technology Ventures and New Venture Partners. New investors included The Ignite Group and Silicon Valley Bank Ventures. The company now has raised around $55 million in total VC funding.

TA Associates has completed a $205 million buyout of Youth and Family Centered Services Inc. (YFCS), an Austin, Texas-based provider of services for abused and neglected children. YFCS was founded in 1997 by company management and Atlanta-based private equity firm Cravey, Green & Whalen, which will retain both a minority ownership stake and a board seat. 


AmberWave Systems Corp., a Salem, N.H.-based semiconductor company, has raised $21 million in Series D funding. 3i Group led the deal, and was joined by return backers Adams Capital Management, Arch Venture Partners, Telesoft Partners and The Hillman Cos.

Vormetric Inc., a Santa Clara, Calif.-based provider of digital asset security solutions, has raised $15 million in Series C funding. JK&B Capital led the deal (which closed in February), and was joined by return backers Sigma Partners, Vanguard Ventures and QTV Capital. The company now has raised $32 million in total VC funding since its 2001 inception.

Infraworks Corp., an Austin, Texas-based provider of digital file security software, has raised $7.45 million in Series B funding. SpaceVest led the deal, and was joined by Convergent Investors and Oak Tree Investors. The company emerged from Chapter 11 bankruptcy protection late last year.

Nucleonics Inc., a Malvern, Pa.-based biotech company focused on RNA interference-based therapeutics, has raised $8.3 million in new Series B funding. The deal total now stands at $49.2 million, following a $40.9 million first close in March. New investor Quaker BioVentures participated in the second close, and was joined by return backers New Enterprise Associates (NEA) and S.R. One Ltd. In related news, the company has added both James Barrett of NEA and Giovanni Ferrara of Burrill & Co. to its board of directors.

EoPlex Technologies Inc., a South San Francisco-based maker of miniature electronic components and subassemblies, has raised $4.3 million in Series B funding. Labrador Ventures led the deal, and was joined by Draper Fisher Jurvetson and Draper-Richards.


Beach Solutions Ltd., a Reading, UK-based provider of IP packaging, integration and re-use, has raised $3 million in new VC funding from return backer MTI Partners. The company also has named Doug McCafferty, former CEO of LEDA Systems, as president.


Evant Inc., a San Francisco-based provider of multi-channel planning and replinishment solutions, has raised $15 million in Series C funding. 3i Group and GRP Partners co-led the deal, with Steven Dietz of GRP joining the Evant board of directors. The company has raised over $100 million of VC funding since its 1994 inception.


NorthStar, a San Francisco-based provider of enterprise wealth management and asset management solutions, has raised $11.5 million in new VC funding from Benchmark Capital, Chess Ventures, H.I.G. Ventures and Pinnacle Ventures. It now has raised $19.2 million to date, including funding from Goldman Sachs, Merrill Lynch and Morgan Stanley.

Bluefire Security Technologies Inc., a Baltimore-based provider of security software for wireless handheld devices, data and networks, has raised $10 million in Series C funding. Investors included Grotech Capital Group, JK&B Capital, Walker Ventures, the Maryland Angels Council and the Maryland Department of Business and Economic Development. The company now has raised over $17 million in total VC funding since its 2001 inception.


Apollo Management has agreed to acquire certain business and product lines from Eastman Chemical Co.‘s coatings, adhesives, specialty polymers and inks (CASPI) unit. The $215 million deal includes a $165 million cash payment at closing, plus a $50 million note payable to Eastman Chemical Co. (NYSE: EMN). A final close is expected in July. J.P. Morgan Securities advised Eastman Chemical on the transaction.


LogistiCare Inc., a College Park, Ga.-based provider of non-emergency transportation services, has completed a $155 million recapitalization, with private equity contributions from Charterhouse Group, Summit Partners and AlpInvest Partners. In related news, Paul Verrochi, a principal with Charterhouse, will serve as LogistiCare chairman.


F5 Networks Inc. (Nasdaq: FFIV) has acquired MagniFire Websystems Inc., a New York-based provider of Web security gateways, for $29 million in cash. MagniFire had raised VC funding from JVP (f.k.a. Jerusalem Venture Partners) and Lucent Venture

Betrusted, a New York-based portfolio company on One Equity Partners, has agreed to acquire Security Assurance Group, a Linthicum, Md.-based provider of information assurance, security consulting and managed services to both the U.S. government and Fortune 1000 companies. No deal terms were disclosed.

ETelecare International, a Philippines-based call center company, has acquired Phase 2 Solutions Inc., a Scottsdale, Ariz.-based provider of customer relationship solutions for the wireless and telecom industries. No deal terms were disclosed. ETelecare was spun off from SPI Technologies late last year, and since has received VC investment from Crimson, AIG, Electra and Anscor.


Lars Johansson has joined Apax Partners as a director and head of the firm’s new Nordic office. He most recently served as a senior partner with Swedish venture capital firm IT Provider, and previously as vice president of corporate finance with Svenska Handelsbanken Markets.

Richard Peteka has joined Apollo Investment Corp. as chief financial officer and treasurer. He most recently served as CFO and treasurer with Citigroup Asset Management, and will replace Art Penn as Apollo Investment’s treasurer. Penn will continue to serve as chief operating officer and vice president. Apollo Investment is a publicly-traded business development company (BDC) formed earlier this year by private equity firm Apollo Management.


GNC Corp., a Pittsburgh-based provider of nutritional supplements, has filed to raise $345 million via an IPO of common stock on the NYSE under proposed ticker symbol GNC. The company was acquired last year for approximately $750 million by Apollo Management, which currently maintains a pre-IPO position of over 95 percent. The selling party was Royal Numico NV.

Symmetry Medical Inc., a Warsaw, Ind.-based provider of equipment for orthopedic device manufacturers, has filed to raise $172.5 million via an IPO of common stock on the NYSE under proposed ticker symbol SMA. The company was acquired in October 2000 by funds affiliated with Olympus Partners, while Windjammer Capital Management also is listed as a significant shareholder.


Blue Sage Capital has closed its inaugural fund with $170 million in limited partner commitments. The Austin, Texas-based firm will use its newfound capital to invest in growth, recap and buyout financings of middle-market companies located in Texas and the Southwest. Blue Sage is led by founding general partners: Bo Baskin (founder and former CEO of Baskin Family Camps; Peter Huff, former general partner with Austin Ventures and Whitney & Co.; and Jim McBride, former non-family executive for The LBJ Holding Co., an investment holding company for the family of Lyndon and Lady Bird Johnson.


Bear Stearns Asset Management has acquired the specialty finance business of Boston-based private equity firm BDC Financial Inc. The BDC specialty finance business provides investment management and advisory services to institutional and high-net-worth investors in private equity. No deal terms were disclosed.


 News from Tuesday 6/1

ARYx Therapeutics Inc., a San Clara, Calif.-based developer of retro-metabolic drugs, has raised $55 million in Series D funding. Nomura Phase4 Ventures led the deal, and was joined by fellow new investors JAFCO Life Science Investments, Scottish Widows Investment Partnership, Montreaux Equity Partners, Novel Bioventures, Itochu International and ATEL Ventures. Return backers included MPM Capital, OrbiMed Advisors and Merlin BioMed. In related news, Paul Sekhri will join the ARYx board of directors. Sekhri is president and chief business officer of ARIAD Pharmaceuticals Inc. (Nasdaq: ARIA), and briefly served as a partner with the Sprout Group.

BC Partners has agreed to sell German sanitary products provider Grohe AG to Texas Pacific Group and CSFB Private Equity. No deal terms were disclosed, although various press reports put the final price at approximately €1.5 billion. BC Partners acquired the company in 1999 from the Grohe family.

Baring Private Equity Partners has completed its management buyout from parent company ING Group. The Baring partners have acquired ownership of their respective management companies, and will continue to use the Baring Private Equity brand. ING Group will retain its existing investment in BPEP funds, but will not participate in new funds. The group’s existing capital commitments of $360 million represent approximately 18% of BPEP’s total assets under management. The deal was first announced last October. In related news, BPEP has decided to restructure by reducing operations in its London headquarters. As a result, Chris Brotchie has stepped down from his CEO position, although he will stick around part-time on the board of directors and/or investment committees of several BPEP regional management companies. Also, Gail Guerin has stepped down as senior marketing partner.


ECredit Inc., a Dedham, Mass.-based provider of Web-based credit and collections automation applications, has raised $8 million in funding. North Hill Ventures led the deal, and was joined by return backers Apex Venture Partners, Internet Capital Group and Sterling Venture Partners.

Virtusa Corp., a Westborough, Mass.-based provider of software development and related IT services, has raised $20 million in Series D funding at a post-money valuation of approximately $155 million. Focus Ventures led the deal, and was joined by return backers Sigma Partners, Charles River Ventures and Globespan Capital Partners. The company now has raised over $57 million in VC funding since its 1996 inception, when it was still known as eRunway Inc.

DecisionPoint Software Inc., a San Mateo, Calif.-based provider of financial performance management software, has raised $5 million in additional Series B funding from existing investor Battery Ventures. The company now has raised around $36 million in total VC funding since its 2000 inception.

MegaPath Networks Inc., a Pleasanton, Calif.-based provider of secure access and managed network solutions, has raised $16.5 million in new VC funding. GM Capital Partners and Comcast Interactive Capital led the deal, and were joined by return backers U.S. Venture Partners, Centre Palisades Ventures and Austin Ventures. The company now has raised around $57 million in total VC funding since its 1999 inception.

Questor Partners has agreed to acquire the non-airline food business – Chef Solutions — of Lufthansa AG. Deal terms were not disclosed.   


Apax Partners has agreed to acquire a majority stake in PCM Uitgevers NV, a Dutch publisher of both national and regional newspapers. No deal terms were disclosed, except that the transaction is expected to close by the end of the month.


Citigroup Venture Partners has finally won creditor approval to acquire the camera phone chips and flat screen units of South Korea-based Hynix Semiconductor Inc., according to various press reports. The deal is valued at approximately $1.12 billion.


Oshkosh Truck Corp. (NYSE: OSK) has agreed to acquire Jerr-Dan Corp. for $80 million from an affiliate of Littlejohn & Co. Jerr-Dan is a Greencastle, Pa.-based manufacturer of towing and recovery equipment, and was acquired in 1999 by Littlejohn.


IntraLase Corp., an Irvine, Calif.-based provider of laser-related software and disposable devices for ophthalmic surgery, has filed to raise $92 million via an IPO of common stock on the Nasdaq under proposed ticker symbol ILSE. The company had raised over $70 million in VC funding since its 1997 inception, with significant shareholders including Brentwood Associates, Domain Associates, EDF Ventures, InterWest Partners, Meritech Capital Partners and Versant Ventures.


Beacon Roofing Supply Inc., a Peabody, Mass.-based distributor of roofing materials, has filed to raise $175 million via an IPO of common stock on the Nasdaq under proposed ticker symbol BECN. The company is majority owned by Chicago-based buyout chop Code, Hennessy & Simmons, which led a management buyout in August 1997. Following the acquisition, Beacon acquired seven regional roofing materials distributors, and opened 20 new branches.


Eugene Lockhart, a venture partner with Oak Investment Partners, has joined the board of directors at NetSpend Corp., an Austin, Texas-based provider of prepaid debit processing platforms.

Richard Gold, a venture director with InnoCal Venture Capital, has been nominated to serve as chairman of California Amplifier Inc. (Nasdaq: CAMP). He has been a director with the company since December 2000, and once served as president and CEO of Nova Crystals

Dewey Ballantine LLP has launched a private equity law practice in its Frankfurt office. The new effort will be headed by new partner Markus Federle, who had worked with Norton Rose since 2002. 


Doll Capital Management has closed its fourth general VC fund with $375 million. The Menlo Park, Calif.-based firm will use the new capital to make early-stage investments in the communications, software and semiconductor sectors. Its previous general vehicle was capped at $471 million.


Equipe Communications Corp. will shut down today, according to Mass High Tech. The Acton, Mass.-based company reportedly had been in talks to be acquired by Lucent for around $10 million, but was unable to seal the deal. Equipe has raised over $100 million in VC funding since its 1999 inception, including a $40 million round in 2002 at a post-money valuation of over $80 million. Company investors included Battery Ventures, Ciena Corp., Matrix Partners, North Bridge Venture Partners, Pequot Capital Management, Sequoia Capital, Silicon Valley Bank and Worldview Technology Partners. No one at Equipe was available this morning to confirm the Mass High Tech report.


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