PE Week Wire — Wednesday 11/26

Get The Wire in your inbox each morning! Just send us an email.


Patricia Lipton has decided to retire as executive director of the State of Wisconsin Investment Board (SWIB), effective January 2. She has served in the position since 1989, but recently ran into some controversy surrounding a large severance package given to resigned private equity portfolio manager Jon Vanderploeg, although it is unknown if Lipton’s retirement is at all related.

Open Solutions Inc., a Glastonbury, Conn.-based provider of client-server-based application software for financial institutions, will begin trading on the Nasdaq today under ticker symbol OPEN. The company priced five million shares of common stock at $17 per share, despite an offering range of just $14 per share to $16 per share. Open Solutions’ total IPO take is $85 million. The company had raised over $70 million in venture capital funding, including a $10 million infusion in 2001 at a post-money valuation of approximately $140 million. Investors included Menlo Ventures, Connecticut Innovations Inc., Axiom Venture Partners, Aetna Life Insurance Co., Key Venture Partners, HNC Software and the BISYS Group.

Chronogen Inc., a Montreal-based drug discovery company focused on age-dependent diseases, has held a Cdn$17 million ($13.01 million) first close on its ongoing Series B funding round. Desjardins Venture Capital led the deal, and was joined by fellow new investor Business Development Bank of Canada. Return backers included CDP Capital- Technology Ventures and T2C2/Bio 2000 L.P.

SKM Growth Investors has sponsored a recapitalization of All-In-One-Products Inc., a Pomona, Calif.-based provider of workplace information posters and other human resources products. No deal terms were disclosed.

Tubel Technologies Inc., a The Woodlands, Texas-based provider of technologies for intelligent completions and production optimization of oil and gas exploration and production, has raised an undisclosed amount of first round funding led by Altira.

Amish Mehta, a principal with Vector Capital, has been named interim CEO of Vector portfolio company Corel Corp. Previous CEO Derek Burney will become Corel’s new chairman.

ThinkEquity Partners, a San Francisco-based investment bank focused on emerging sector research, has received a strategic investment from Columbus Nova.

Micros-to-Mainframes Inc. (Nasdaq: MTMC) has signed a non-binding term sheet to accept an investment from Pequot Ventures. The deal includes up to $25 million of convertible preferred stock and warrants to Pequot in three tranches. The purchase of the second and third tranches in an aggregate amount of up to $18 million would be solely at Pequot’s option. The intended purpose of the financing is to provide MtM with funds for working capital and to support future acquisitions, as part of a consolidation strategy for the IT services and consulting sector.

Multimedia Live Inc., a Petaluma, Calif.-based software and e-commerce company, has received a $7.5 million investment from Sequoia Capital, according to a report in the Press Democrat.


SIRVA Inc., a Westmont, Ill.-based global relocation services provider, today will begin trading on the NYSE under ticker symbol SIR. Yesterday, the company priced over 21.05 million shares of common stock at $18.50 per share, for a total IPO take of just over $389.47 million. The company was launched in 1998 as an acquisition platform by buyout firm (and majority owner) Clayton, Dubilier & Rice. Its first acquisition was North American Van Lines, and SIRVA later merged with Allied Van Lines.

TuVox Inc., a Los Altos, Calif.-based provider of conversational voice response applications for call centers, has raised $6 million in second-round venture capital funding. New investor Foundation Capital led the deal, and was joined by return backers Granite Ventures and Adobe Ventures. TuVox previously raised a $5.19 million Series A round in 2002 at a post-money valuation of approximately $10 million.

The Tobacco Settlement Investment Board of Pennsylvania has approved a $20 million commitment to Birchmere Ventures III, a new life sciences investment fund jointly formed by Pittsburgh-based Birchmere Ventures and San Francisco-based Bay City Capital. The fund is being marketed with a $150 million target capitalization.

Polycom Inc. (Nasdaq: PLCM) has agreed to acquire Voyant Technologies Inc., a Westminster, Colo.-based provider of voice conferencing and collaboration network solutions. Polycom will acquire all of the outstanding shares and options of Voyant in exchange for approximately $110.7 million in cash consideration, or $95.7 million, net of the expected amount of Voyant cash to be available at the closing. An additional $35 million may be payable in cash or Polycom stock, at Polycom’s sole discretion, to certain stockholders of Voyant, over a two year period based on the successful completion of certain financial milestones relating to the sale of Voyant products. The deal is expected to close during Q1 2004. Voyant received a $15 million round of funding in 2000 led by TA Associates, at a post-money valuation of approximately $135 million.

Nexstar Broadcasting Group Inc. began trading on the Nasdaq yesterday under ticker symbol NXST. The Irving, Texas-based television broadcaster had priced 10 million shares of common stock at $14 per share for a total IPO take of $140 million. It closed trading yesterday at $13.25 per share. Shareholders include ABRY Partners and Bank of America Capital Investors.

Tissue Regeneration Inc. (TRI), a Medford, Mass.-based developer of human tissue replacements for diseased or damaged soft tissue, has received a $750,000 National Institutes of Health (NIH) grant to support a bio-engineered tissue replacement product.

Cooley Godward LLP has elected ten associates to join the firm’s partnership, effective January 1. The new partners are Brian Ankenbrandt, Matthew Browne, Robert Cahill, Kirk Dizon, Michelle Doolin, Brent Fassett, Grant Fondo, Marya Postner, Aaron Velli and Peter Willsey.

Capital Lease Funding Inc., a New York-based commercial mortgage lender, has filed to raise $230 million via an IPO on the NYSE under an undetermined ticker symbol. The company has received private equity funding from Hyperion Partners.

Clayton Dubilier & Rice Inc. has reached an agreement to restructure Dutch electrical equipment distributor Hagemeyer NV, according to various press reports.

Purely Proteins Ltd., a Cambridge, UK-based biotech company, has raised an undisclosed amount of first-round funding from Avlar BioVentures and Yorkshire Fund Managers.

The Chicago Tribune is reporting that Patrick Rea has been appointed by the Bush Administration to oversee a six-state region for the Small Business Administration. The states are Illinois, Indiana, Michigan, Minnesota, Ohio and Wisconsin. Rae most recently served as executive director of the Illinois Development Finance Authority, and is the first appointment to his position since Bush took office in 2001. He replaces acting administrator Judith Roussel, who will continue on as director of the Illinois district.

Ashish Chugh has joined Blue Chip Venture Co. and will relocate from New York to the firm’s Cincinnati headquarters. Chugh most recently worked at MediaTech Capital Partners, where he analyzed investment opportunities in the IT, media and telecom spaces.

Time Warner Inc. (NYSE: TWX) has agreed to sell its Warner Music Group to an investor group that includes Thomas H. Lee Partners, Lexa Partners (run by Edgar Bronfman Jr.), Bain Capital and Providence Equity Partners. The sale is for approximately $2.6 billion in cash and other consideration, including the option of buying back into the business on favorable terms in the future.

CardioMEMS Inc., an Atlanta-based provider of wireless medical devices for the management of abdominal aortic aneurysms and congestive heart failure, has raised $14 million in Series B funding. Boston Millennia Partners led the deal, and was joined by fellow new investors Foundation Medical Partners, Guidant Corp., Johnson and Johnson Development Corp. and Arboretum Ventures.


CIVC Partners, a Chicago-based private equity firm, has held a final closing on its $650 million third fund. The closing occurred on October 31, and included commitments from limited partners like Antares Capital, ATAPCO, Bank of America, Cheyenne Capital, Key Bank, Northwestern Mutual Life, Madison Capital, Mass Mutual, Oak Hill and PPM America. Probitas Partners served as the placement agent for Fund III.

Tribe Networks Inc., a San Francisco-based provider of online classified services, has raised $6.3 million new venture capital funding. Mayfield led the deal, and was joined by Knight Ridder (NYSE: KRI) and The Washington Post Co. (NYSE:WPO).

UniSource Energy Corp. (NYSE: UNS) has agreed to sell all of its outstanding shares to an affiliate of Saguaro Utility Group, whose limited partners include private equity firms Kohlberg Kravis Roberts & Co., J.P. Morgan Partners, LLC, and Wachovia Capital Partners. Saguaro will pay $25.25 per share of UniSource common stock, which represents a 30% premium over last Friday’s closing price. The total transaction is worth approximately $260 million.

Vonage Holdings Corp., an Edison, N.J.-based provider of broadband phone services, has raised $35 million in second-round funding. New Enterprise Associates led the deal with a $12 million investment. No other investor information has been released.

Formed Fiber Technologies, a platform company owned by Morgenthaler Partners, has acquired Martin Color-Fi Inc., a Sumter, S.C.-based producer of polyester fiber. Terms of the deal were not disclosed.

Duke Street Capital has acquired Accantia Health & Beauty Ltd. from ABN AMRO Capital for total considerations of £225 million (approx. $382 million). Accantia is a Birmingham, UK-based provider of health, beauty and feminine hygiene products, and reported 2002 sales of £96 million. Bank of Scotland Corporate Banking acted as lead-arranger and underwriter of the debt facilities for the acquisition.

The Baring Central European Fund has sold its interest in Topway Asset Management SA, the holding company of Ultex, a Romania-based owner and operator of oil-seed crushing facilities. Topway Asset Management is the second of the Topway businesses to be exited by Baring following the restructuring of the parent company, Topway Industries, last year. BCEF sold its shares to Vasile Nitescu, a Romanian businessman and investor with widespread interests in tourism, trade, agriculture and chemicals. Nitescu is also the chairman of Romilexim, one of Romania’s largest companies.

VenGrowth Capital Partners Inc. today launched the VenGrowth Traditional Industries Fund, a tax-advantaged labor-sponsored investment fund designed to offer individual Canadian investors capital preservation and the potential for future growth. The fund will provide loans to established, mid-market Canadian businesses in the “traditional” manufacturing and services sectors, with an aim to generate a steady flow of current interest or dividend income to the fund.

Open Services Inc., a Westborough, Mass.-based provider of enterprise network security management software, has raised $8 million in Series C funding. Advent International led the deal, and was joined by return backers 1to1 Ventures, Hudson Ventures, LibertyView Equity Partners, Zesiger Capital Group and Open Services CEO Theodore Joseph. Asterand Inc., a Detroit-based human tissue research bank, has raised over $3 million in Series C funding. New investors included Apjohn Ventures and Arboretum Partners and Chrysalis Ventures, while return backers included Oxford Bioscience Partners and Fort Washington Capital Partners.

Patriot Managed Care Solutions, a portfolio company of Eaglestone Investment Partners, has acquired software and other assets related to the managed care business of MDServe Inc. No deal terms were disclosed.

Galey & Lord Inc. (OTC BB: GYLDQ) has received U.S. Bankruptcy Court approval to complete the sale of its Klopman International Group to an investment group led by BS Private Equity. The transaction, with an enterprise value of $47 million (including assumed obligations), is expected to close within the next 30 days subject to the consent of the Tunisian authorities. Klopman, founded in the 1960s, is a London-based manufacturer and marketer of poly-cotton fabric for work wear, protective wear and apparel.

Legend Films, a San Diego-based studio that specializes in restoring and colorizing classic films, has raised $1 million in Series B funding. Return backer PAR Capital Management led the deal.

Click here for last week’s complete Wire

This is a free sample of content available to paid subscribers of Private Equity Week.
Click here for more information.