PE Week Wire: Tues., June 5, 2007

The Blackstone Group is beginning its IPO road-show this week, replete with a 698-page amended S-1 filing. That’s approximately one page for each expected press report about how Blackstone submitted an amended S-1 filing. If you dare download the entire doc, you can find it here.

The amended filing notes that Blackstone’s current fund has $19.6 billion incapital commitments, which means that an amended filing may soon be in the works. My colleague Mark Cecil is reporting over at that Blackstone will (finally) wrap up fundraising at the end of July, on over $22 billion. At that size, it would be the largest private equity fund ever raised, although I actually had thought it might be even a bit larger. Matt mentions in the story that Blackstone chief Steve Schwarzman recently spent some time fundraising in the Middle East. I can vouch for that, as he blew off a scheduled interview after a speech in Philly earlier this year. Seems he was late for a flight to Dubai (or maybe Kuwait – I can’t quite remember).

As for new info in the amended S-1, there wasn’t much (read: still awaiting compensation figures). It included some more detailed info related to the recent $3 billion investment from the Chinese government, and also noted that it will add three high-profile directors: Canadian Prime Minister Brian Mulroney, former Deloitte Touche Tohmatsu CEO William Parrett and British I-banker Lord Nathaniel Charles Jacob Rothschild.

*** As we pre-reported, Bain Capital did not unveil new fundraising plans during last week’s annual meeting. But still expect marketing to begin later this year, as Bain acknowledged in a recent letter accompanying its March financial reports to LPs.

*** Amp’d Mobile yesterday filed some additional documents related to its Chapter 11 declaration, and I’ve uploaded some of them to peHUB. A quick read shows that Amp’d is mostly blaming Verizon for its straits, and even suggests that it may file suit for what it alleges was an improper service termination warning. Seems that Amp’d had a debtor-in-possession financing agreement in place last Friday morning, but that the Verizon letter made Amp’d unable to satisfy certain conditions of the financing. The result was a late-night Chapter 11 filing. The Amp’d saga might make a good book someday, or at least an interesting long-form magazine article…

*** Quiz Time: A brand-name VC firm recently held its annual meeting, and surprised some LPs by basically insulting another VC firm from the stage. Hint: The insulted firm is currently raising a new fund.

Top Three

Silver Lake Partners and TPG have agreed to acquire telecom equipment maker Avaya Inc. (NYSE: AV) for $17.50 per share, for a total value of $8.2 billion. The offer represents a 28% premium over the closing share price on May 25, the last trading day before reports emerged that Avaya was negotiating to sell all or part of the company.

Amgen (Nasdaq: AMGN) has agreed to acquire Ilypsa Inc., a Santa Clara, Calif.-based developer of non-absorbed drugs for renal disorders. The deal is valued at $420 million in cash, and is expected to close next quarter. Ilypsa has raised over $46 million in VC funding since 2003, from firms like 5AM Ventures, Sprout Group, CMEA Ventures, Delphi Ventures, Johnson & Johnson Development Corp., Mediphase Venture Partners and U.S. Venture Partners.

Tudor Ventures has closed its third fund with $262 million in capital commitments. The Boston-based firm focuses on IT companies in sectors like financial technology, software, communications, media and IT

VC Deals

ShotSpotter Inc., a Santa Clara, Calif.-based provider of gunshot location systems for public safety and the military, has raised $12 million in Series C funding. Levensohn Venture Partners led the deal, and was joined by Labrador Ventures and return backers Claremont Creek Capital, Citi Light Capital and Lauder Partners. ShotSpotter previously raised a $9.4 million Series B round in 2006 at a post-money valuation of around $15 million.

Tioga Energy Inc., a Sunnyvale, Calif.–based provider of solar power purchasing services, has raised more than $10 million in first-round funding. Participants include NGEN Partners, Draper Fisher Jurvetson, Rockport Capital, DFJ Frontier and Kirlan Ventures. Tioga is basically a restart of CerOx Corp., which closed earlier this year after having raised around $15 million over two rounds.

Seatwave, a UK-based online marketplace for concert ticket reselling, has raised $8 million in second-round funding. Mangrove led the deal, and was joined by return backer Atlas Venture and German angel Oliver Jung.

InsideView Inc., a San Bruno, Calif.-based provider of on-demand sales intelligence services, has raised $7.4 million in Series A funding. Emergence Capital Partners led the deal, and was joined by seed backers Greenhouse Capital Partners and Rembrandt Venture Partners.

IceBreaker Inc., a Bellevue, Wash.-based provider of mobile social software, has raised $7.2 million in Series A funding. The deal was co-led by Frazier Technology Ventures and seed backer Lightspeed Venture Partners.

Hyperic Inc., a San Francisco-based provider of multi-platform open-source systems management, has raised $6.1 million in second-round funding from return backers Benchmark Capital and Accel Partners. Hyperic launched in 2004, and raised an initial $3.8 million round in May 2006.

FameCast Inc., an Austin, Texas-based producer of an online talent competition, has raised $4.5 million in first-round funding from Austin Ventures.

Mobicious Inc., a Waltham, Mass.–based website where consumer can find mobile phone content, services and applications, has raised $4 million in first-round funding from North Bridge Venture Partners and Carmel Ventures.

GuestCentric Systems, a Stamford, Conn.-based developer of web services for travelers and the travel industry, has raised $1.25 million in seed funding. Ask Venture Partners led the deal, and was joined by Change Partners., a New York-based video sharing website, has held a first close on its Series B funding round led by Ambient Sound Investments, a VC fund formed by the four founding engineers of Skype. No financial terms were disclosed. Other round participants included Lauder Partners, Jeffrey Sechrest (co-head of media/entertainment at Lazard), Andrew Rasiej (founder of the Personal Democracy Forum), Jonathan Kopp (partner with PR firm SS&K) and Ken Sawyer (founder of Saints Capital).

Buyout Deals

Angelo Gordon & Co. has increased its buyout offer for National Home Health Care Corp. (Nasdaq: NHHC), from $12.50 per share to $12.75 per share, for an equity value of just over $72 million. Angelo Gordon also would pay NHHC shareholders 10 cents per share, in order to settle a class action suit.

Axa Private Equity has acquired Diana Ingredients from Cognetas for €710 million. Cognetas backed a €270 million management of Diana Ingredients from PAI Partners in 2004. Diana is a Vannes, France-based provider of natural ingredients to the pet food and food and beverage industries.

Caritor Inc., a San Ramon, Calif.-based IT services provider, has completed its $14.30 per share buyout of outsourcing company Keane Inc. (NYSE: KEA). The total deal was valued at approximately $854 million, with Caritor receiving equity financing from existing shareholder Citigroup Venture Capital International and leveraged financing from Citigroup Global Markets, UBS Securities and Bank of America Securities.

Diamond Castle Holdings has completed its acquisition of BlueStone TV Holdings Inc. from Providence Equity Partners for $230 million. BlueStone is a Wichita, Kan.–based owner and/or operator of television stations with multiple network affiliations in eight markets. DiamondCastle partnered on the deal with Randy Bongarten, former president of Emmis Television.

European Capital has sponsored a €337 million buyout of UK blinds maker Hillarys Brands from Change Capital Partners. European Capital received a 52% equity stake, while its investment included equity, loan notes, mezzanine debt and senior term loans. Hillarys management also invested both equity and debt.

Genstar Capital has acquired ConvergeOne Holdings Corp. from Nautic Partners. No financial terms were disclosed. ConvergeOne is a Coatesville, Pa.-based IP telephony company.

Lion Capital has acquired Dutch department store chain Hema from parent group Maxeda, a portfolio company of AlpInvest, Cinven, KKR and Permira. No financial terms were disclosed. Hema reported gross sales of more than €1.3 billion last year, and has 355 stores in the Netherlands, Germany, France Belgium and Luxembourg.

Stone Arch Capital has sponsored a recapitalization of Natural Resource Group Inc., a Minneapolis–based environmental consulting firm serving the U.S. energy industry. No financial terms were disclosed. NRG was advised on the deal by Goldsmith Agio Helms.

Stryker Corp. (NYSE: SYK) has sold its outpatient physical therapy business, Physiotherapy Associates, to Water Street Healthcare Partners for approximately $150 million in cash. Water Street also has committed an undisclosed amount of additional equity capital to enable Physiotherapy Associates’ growth via acquisitions. Under the terms of the deal, Stryker will retain responsibility for certain cash damages to be paid in connection with a DoJ investigation of Physiotherapy Associates’ billing and coding practices. The Company’s liability for such damages has been fixed under the sale agreement, with interest to be accrued.

SV Investment Partners has completed a $97.5 million dividend recapitalization of International Decision Systems Inc., a Minneapolis–based provider of asset finance origination and portfolio management software. IDFS has been an SV portfolio company since 2003.

FKI PLC, a UK-based packager of cans for PepsiCo, on Thursday is expected to release financial results – with a possible private equity bid rumored to be among the talking points. FKI shares rose as much a 7% last week, after it said an unidentified suitor made a Gbp765 million buyout approach.

PE-Backed IPOs

Validus Holdings Ltd., a Bermuda-based reinsurance company, has increased its proposed IPO target from $200 million to $350 million. No specific terms have been disclosed. Validus plans to trade on the NYSE under ticker symbol VR, with Goldman Sachs and Merrill Lynch serving as co-lead underwriters. It was formed in October 2005, with funding from Aquiline Capital Partners, Goldman Sachs Capital Partners, Vestar Capital Partners, New Mountain Capital and Merrill Lynch Global Private Equity.

Wendel Investissement executive board chairman Jean-Bernard Lafonta said in an interview that portfolio company Bureau Veritas will price an IPO by “the end of the year.” Bureau Veritas is a multi-disciplinary provider of inspection, testing, auditing and certification services.

PE Exits

EMC Corp. has acquired Verid Inc., a Fort Lauderdale, Fla.-based provider of identity verification solutions. No financial terms were disclosed. Verid has raised over $13 million in VC funding from firms like Fidelity Ventures and CIBC Capital Partners.

The Riverside Company has sold Zetkama to Avallon MBO, a Warsaw-listed acquisition platform. No financial terms were disclosed. Zetkama is a Polish manufacturer of industrial valves and specialized cast iron. It was acquired by Riverside in April 1999, with Riverside reporting a gross IRR of 28 percent.

PE-Backed M&A

Aepona of Ireland has merged with Sweden-based Appium, in order to create a singer vendor for the telecom service layer. No financial terms were disclosed. Aepona has raised nearly $50 million in VC funding from firms like Amadeus Capital Partners, Invest Northern Ireland, Polaris Venture Partners and Trinity Venture Capital. Appium has raised over $10 million in VC funding from firms like InnovationsKapital, Innovacom and Nordic Venture Partners.

Huron Capital Partners announced that three of its portfolio companies have made add-on acquisitions. Quest Specialty Chemicals expanded its construction coatings unit with the acquisition of UC Holdings. Tectrans expanded its ground transportation business into the Northern California market, with the acquisition of Mobility Solutions. Finally, prefabricated residential staircase maker Southern Staircase acquired Stair Parts Inc., a manufacturer of components for custom staircases. No financial terms were disclosed for any of the transactions.

Firms & Funds

Bear Stearns has formed an asset management company in Saudi Arabia, in partnership with a consortium of Saudi business leaders. The Riyadh-based joint venture is called Bear Stearns Arabia Asset Management, and will develop and distribute Sharia-compliant and other investment products to institutions and high-net-worth individuals in Saudi Arabia. It also will leverage Bear Stearns Asset Management’s existing platform, offering traditional equity and fixed income, hedge fund and private equity fund products.

Leeds Equity Partners is targeting $1 billion for its fifth fund, according to LBO Wire. The New York-based firm focuses on the education and training sectors, and raised $430 million for its prior fund. It already has secured a $100 million cornerstone investment for Fund V from GE Pension Trust.

Mayfield has opened an office in Mumbai, and has hired Nikhil Khattau and Vikram Godse to staff it, according to VentureWire. Khattau was the founding CEO of SUN F&C Asset Management, while Godse was a founder of JM Financial Investment Managers Ltd.

Dutch pension systems BP and PGGM have awarded AlpInvest a €500 million mandate to invest in private clean technology companies over the next three years.

Human Resources

Luca Colciago has joined UK-based venture debt firm Kreos Capital as a partner. He previously was a director with Noble Venture Finance.

Friend Skolar & Co. has promoted Dean Bosacki from vice president to director. He joined the firm in 2002, after having received his MBA from Stanford.

John Comly has joined Blue Point Capital Partners as an associate in the firm’s Charlotte office. He previously was an analyst in the M&A group at Wachovia Securities.

Jordan Caspari has joined Liquid Realty Partners as an associate. He previously was an analyst in the global private equity group at Oxford Properties, the real estate arm of the Ontario Municipal Employee Retirement System Fund.