PE Week Wire: Wed., Jan. 9, 2008

Yesterday’s big Bear Stearns news was that Jimmy Cayne stepped down as CEO. But there is another Bear departure that has a bit more relevance for our purposes: Jerry Newman, a senior managing director and head of venture capital coverage.

Jerry has left to join his 34-year-old son Ari at Newman Venture Advisors, a Boulder, Colo.-based VC fundraising and advisory services firm launched in 2005. His official title is senior partner, and it is very much a fulltime job.

“I had been thinking about leaving for the past two years,” Jerry says. “I’ve spent nearly 40 years in the Valley, and really wanted to do a bunch of things that I was prevented from doing because of compliance and regulatory reasons.”

Newman began his career managing Nasdaq trading desks at Merrill Lynch and H&Q, before joining Cowen & Co. as a partner. He would create Cowen’s venture capital coverage group, before leaving to do the same thing at JP Morgan. He left after the Chase merger, at which point he joined Bear Stearns.

Newman currently sits on the boards of VC-backed PodShow and Desi Hits, based on personal investments. He plans to maintain those positions, and probably make additional investments.

*** AEA Investors is close to wrapping up its latest fund with $1.5 billion, according to my colleague David Toll. Actually, it’s according to someone who David talked to, but you get what I mean. The New York-based firm closed its last fund at $1.1 billion in 2003, and later raised a $600 million mezzanine vehicle and $285 million small business fund. AEA traces its roots back nearly 40 years, when it was set up to manage private investments for the Rockefellers, Mellons and other prominent industrial families. Look for more later today over at the Buyouts Magazine website.

*** Jim Cramer sets odds on a Chrysler collapse.

*** Thanks to the many of you who asked to be put on the peHUB Shindig waiting list for next Thursday’s event in Philly. I should have news for you (either pro or con) by day’s end. Also, a lot of readers are asking for events in other towns – particularly in New York and Boston. I hear you…

*** Speaking of events, I’m speaking at a bunch of them: First up, of course, is next Friday’s Wharton Private Equity & Venture Capital Conference. I’ll be moderating the tax and legal policy/implications panel. Next is the Dealmakers 2008 Outlook, hosted by ACG Boston on February 13. I’ll be moderating a high-powered group that includes Josh Beckenstein (Bain), Kevin Callaghan (Berkshire), Jill Greenthal (Blackstone) and Marty Manion (Summit). Finally, I’ve been tapped to do the “interview” of Carl Icahn, at Buyouts East. Hope to see you around.

Top Three

CalPERS has agreed to acquire a 9.9% ownership position in tech-focused private equity firm Silver Lake Partners. No financial terms were disclosed, although the New York Times reported a price-tag of approximately $275 million. CalPERS also committed to making additional commitments as a limited partner in Silver Lake funds. Evercore Partners served as financial advisor to Silver Lake on the deal, while Simpson Thacher & Bartlett acted as legal advisor. Inc., an Atlanta-based global online B2B marketplace for the manufacturing community, has raised $26 million in new VC funding. Fidelity Ventures and Fidelity Asia Ventures co-led the deal, and were joined by return backer European Founders Fund. also has previously raised capital from Bezos Expedition, the personal investment vehicle of chief Jeff Bezos.

The Ontario government has agreed to form a $165 million venture capital fund focused on companies within the province. It is being formed in partnership with OMERS, RBC Capital Partners, Business Development Bank of Canada and Manulife Financial.

VC Deals

Primera Biosystems Inc., a Mansfield, Mass.-based molecular diagnostics company, has raised $21 million in Series B funding. Abingworth Management led the deal, and was joined by Interwest Partners and return backers Malaysian Technology Development Corp., MPM Capital, Burrill & Co. and the Invus Group. It had previously raised $14.5 million.

Confirma Inc., a Bellevue, Wash.-based provider of computer-aided detection for MRI , has raised $17.5 million in Series C funding. Telegraph Hill Partners led the deal, and was joined by Fluke Venture Partners and return backers Northwest Venture Associates, Prism Ventureworks and Versant Ventures. The company previously had raised around $18 million since 1998.

Earth Class Mail Corp. (f.k.a. Document Command), a Seattle-based virtual post office company, has raised $13.3 million in Series A funding led by Ignition Partners.peHUB had reported last fall that the company had secured $7.4 million of a $19.69 million round total, based on a regulatory filing. The company previously raised $3.25 million in seed funding from Alliance of Angels, Keiretsu Forum and other angel groups.

Arcion Therapeutics, a Baltimore-based biotech company focused on alleviating pain associated with diabetic neuropathy, has raised $8.8 million in Series A funding. CMEA Ventures and InterWest Partners co-led the round.

Nuventix Inc., an Austin, Texas-based developer of thermal management cooling solutions for the computer and consumer electronics market, has raised $8.5 million of a Series A round expected to close shortly on $10 million. Backers include InterWest Partners, Rho Ventures, CenterPoint Venture Partners and STARTech Early Ventures. News of the deal was first reported by The Austin-American Statesman.

PubMatic Inc., a Palo Alto, Calif.-based provider of an ad optimization platform for online publishers, has raised $7 million in Series A funding.Nexus India Capital led the deal, and was joined by Draper Fisher Jurvetson and Helion Ventures.

Peakdale Molecular Ltd., a UK-based provider of specialist chemistry services to the pharmaceutical industry, has raised Gbp1 million in equity funding led by Solon Ventures.

NeurogesX Inc. (Nasdaq: NGSX), a San Carlos, Calif.-based drug company focused on pain management therapies, has completed a $25 million private placement of common stock. Venture capital firm SV Life Sciences led the deal. NeurogesX went public last May, after having raised around $90 million in VC funding from firms like Arch Venture Partners, Alta Partners, Global Life Sciences Ventures, Montreux Equity Partners and Walden International.

Repco Home Finance Ltd., a Chennai, India-based housing finance company, has raised $27.7 million from Carlyle Asia Growth Partners.

Buyout Deals

Avista Capital Partners has completed its $525 million acquisition of Bristol-Myers Squibb’s medical imaging unit.The Billerica, Mass.-based unit provides medical imaging products primarily focused on cardiovascular diagnostic imaging to nuclear physicians, cardiologists, radiologists, internal medicine physicians, IDNs/GPOs and technologists/sonographers working in hospitals and outpatient clinics.

Chicago Growth Partners has sponsored a recapitalization of Benetech, a Montgomery, Ill.–based provider of dust management and safety solutions used by the coal-fired utility industry. Golub Capital provided $36 million in debt financing, but full financial details were not disclosed. Golub also co-invested in the equity tranche.

Crystel Ridge Partners has acquired Cord Crafts Inc., a Wharton, N.J.-based provider of artificial flowers and plant arrangements. The deal included $13 million in senior financing from PNC Financial Services.

DLJ Merchant Banking Partners has acquired a control stake in Den-Mat Holdings LLC, a Santa Maria, Calif.–based maker of minimally invasive dental products for cosmetic and professional dentists. No financial terms were disclosed for the deal, which closed in December.

Gridiron Capital has acquired Electronic Systems Protection Inc., a Zebulon, N.C.–based provider of power filtration and power protection technology. Company management also participated. No financial terms were disclosed.

Prospect Partners has sponsored a recapitalization of Gold Star Foods Inc., a Los Angeles-based foodservice distributor for public school districts. No financial terms were disclosed.

PE-Backed IPOs

RiskMetrics Group Inc., a New York-based provider of financial risk management and corporate governance products and services, has set its IPO terms to 14 million common shares being offered at between $17 and $19 per share. It would have an initial market cap of approximately $1.1 billion, were it to price at the high end of its range. The company plans to trade on the NYSE under ticker symbol RMG, with Credit Suisse, Goldman Sachs and Banc of America Securities serving as co-lead underwriters. RiskMetrics spun out of JPMorgan in September 1998, and later completed a $122 million recapitalization sponsored by Spectrum Equity Investors (27.99% pre-IPO stake), General Atlantic (27.99%) and Technology Crossover Ventures (12.31%). TCV plans to purchase up to $10 million in common stock from the underwriters, as part of the IPO.

Bayhill Therapeutics Inc., a Palo Alto, Calif.-based drug company focused on autoimmune diseases like multiple sclerosis, has filed for an $86.25 million IPO. It plans to trade on the Nasdaq under ticker symbol BHTX, with Pacific Growth Equities and Lazard Capital Markets serving as co-lead underwriters. The company has raised $62.75 million in VC funding, from firms like U.S. Venture Partners (21.38% pre-IPO stake), Morgenthaler Ventures (11.38%), De Novo Ventures (11%), CMEA Ventures (10.46%), Lilly Ventures (9.17%), Latterell Venture Partners (7.32%), Montreux Equity Partners (5.5%), A.M. Pappas Life Science Ventures, Boston Life Science Venture Corp., Grand Cathay Venture Capital Co., PAC-LINK Bio Management Corp., Prudence Venture Investment and Vertical Group.

PE Exits

Exist Global, a Philippines-based software engineering services firm, has acquired DevZuz, a Marina Del Rey, Calif.-based developer of developer of delivery platforms that link enterprise businesses to application development projects and processes. No financial terms were disclosed for the deal. DevZuz has raised around $9.25 million in funding from Mission Ventures and Redpoint Ventures. Both firms are expected to become shareholders in Exist Global.

Segulah has completed its sale of Kosan Crisplant AS, a Danish provider of systems and solutions for filling and reconditioning of liquefied petroleum gas cylinders, to United International Bank of Bahrain. No financial terms were disclosed.

PE-Backed M&A

Marketwire, a portfolio company of OMERS Capital Partners, has agreed to acquire International Media Services Cos., a Miami-based provider of newswire services to emerging markets in Asia and Latin America. No financial terms were disclosed.

Firms & Funds

Blum Capital Partners has held a $1 billion first close on its second fund, according to a regulatory filing. The San Francisco-based firm has an upper target of $2.4 billion, and is using Triago as its placement agent.

Yellowstone Capital Partners of Houston is targeting $50 million for its second alternative and renewable energy fund.

Human Resources

Gareth Healy and Malcolm Coffin have joined UK middle-market firm Inflexion as an investment director and investment executive, respectively. Healy previously was a managing director with Close Brothers, where he focused on advising private equity clients. Coffin was a member of the consumer products M&A team at NM Rothschildd & Sons.

Stephan Oppenheimer has joined Moelis & Co. as a partner in the firm’s private equity business. He previously was with CCMP Capital.

Diane Smith has joined Darby Overseas Investments to oversee its mezzanine finance activities in Latin America, with a particular focus on Brazil. She previously was a managing director with Electra Investment Trust.