PE Week Wire: Wednesday, November 19, 2008

It’s that time of year, when young MBA candidates’ thoughts turn to flights of summer internships. So let’s help them out, through our 6th Annual Internship Rodeo.

Today I am asking private equity firms to contact me via email if you’re looking for a summer intern from the current crop of first-year MBA candidates. All types of firms need apply — VC, LBO, I-banks, Mezzanine, Consulting, Funds-of-Funds, etc. Ditto for geography.

In your emails, please include your firm name, job location and type of business (i.e., VC/LBO/etc.). You also may include any additional information you would like posted, including a contact email address for applicants. If you would prefer me to create an anonymous email account for you, just let me know.

Your firm name will be kept confidential, unless you specifically request it to be disclosed (which about 50% of firms requested last year). Once compiled, the listings will be posted in the peHUB MBA Forum, an online message-board only accessible to MBA candidates. It currently has over 1,000 members, and that’s sure to grow once word of the Rodeo gets around.

So please get me your information as soon as possible. We have placed over 350 summer interns via this program, and many have gone on to fulltime employment at their internship site following graduation. So, again, please get those emails of interest to me so that we can post the internship listings ASAP.

There is no charge for this service.

*** If you are a current MBA candidate, PLEASE DO NOT email me your CV or other info about how wonderful and deserving you are. Once I’m ready to actually launch the Rodeo, I’ll let you know.

*** There has been an extraordinary amount of digital ink spent on Sequoia Capital’s “graveyard” deck, but it seems that the stuff is infinite. So here’s a bit more, in notes form:

• Sequoia has gotten a lot of credit for “telling it like it is,” but shouldn’t it also get some blame for being behind the eight-ball? Specifically, how did Sequoia seemingly allow so many of its companies to become bloated enough – particularly the young ones – that they can so easily shed jobs? It’s one thing to kill off a non-core auto or financial services vertical, but quite another to slash within the main biz. Smart CEOs were beginning to cut burn rate quarters ago, and smart VCs were telling the dumb ones to do so.

• That said, it was still a brilliant PR ploy. Seems each one of its portfolio companies got a press pass for making cuts.

• During a panel discussion this past Saturday, Andy Goldfarb of Globespan noted that Sequoia’s presentation to its CEOs was followed by wine and cheese. Way to really make the cost-cutting message stick. The only way this should have happened if it was box wine and Velveeta on Ritz.

*** Answer Key: Yesterday I asked you to name the former banking big who has partnered with Blackstone Group for a PE platform that will focus on distressed banks and other financial institutions?

I didn’t expect that the first correct responder would be a Reuters colleague who was working on the same scoop, or how bureaucratically difficult it would be for me to co-byline an “official” Reuters wire article (apparently they like me, but just not in that way). Anyway, the answer is Steve Steinour, former CEO of Citizens Financial Group. You can read more here.

Top Three

Archemix Corp., a Cambridge, Mass.-based developer of aptamer-based therapeutics, has agreed to go public via a reverse merger with NitroMed Inc. (Nasdaq: NTMD). Archemix shareholders will own 70% of the combined company, while NitroMed shareholders will hold the remainder. Archemix earlier this year withdrew an IPO offering, after having raised around $135 million in VC funding from firms like Atlas Venture (13.9% stake), Prospect Venture Partners (13.9%), Highland Capital Parnters (13.2%), SV Life Sciences (11.6%), KGaA (11.3%), Rho Ventures (9.6%) and Care Capital (5.3%).

SunEthanol, an Amherst, Mass.-based developer of cellulosic ethanol production technology, has raised $25 million in Series B funding. Venrock led the round, and was joined by BP, Soros Fund Management and return backers Battery Ventures, Long River Ventures and Camros Capital. Past backer VeraSun did not participate, after having recently filed for Chapter 11 bankruptcy protection. The company also announced a name change to Qteros.

The Carlyle Group has agreed to sell AxleTech International to General Dynamics (NYSE: GD) for an undisclosed amount. Carlyle acquired AxleTech in late 2005 from Wynnchurch Capital. The company makes parts for military vehicles, commercial specialty trucks and off-highway machines.

VC Deals

GANYMED Pharmaceuticals AG, a Mainz, Germany-based developer of cancer antibodies, has raised €65 million in new VC funding. The round was led by existing majority shareholder ATS, a Strungmann brothers family office focused on the biotech sector. Other backers include Future Capital AG, MIG Verwaltungs AG and individual angels.

Blyk, a Finland-based mobile network for young people, has raised €40 million in new VC funding. No additional details were disclosed for the round, which was announced on the company’s blog. Company shareholders include Sofinnova Partners.

Finjan Inc., a San Jose, Calif.-based provider of secure web gateway solutions for the enterprise market, has raised $22 million in fifth-round funding. Return backer HarbourVest Partners led the round, and was joined by Benhamou Global Ventures, Benchmark Capital, Israel Seed Partners and Cisco. The company had previously raised around $45 million.

Tengion Inc., an East Norriton, Penn.-based regenerative medicine company focused on replacement bladders, has raised approximately $21 million in additional Series C funding, bringing the round total to $54 million. Safeguard Scientifics was joined on the round by return backers Bain Capital, Johnson & Johnson Development Corp., Deerfield Partners, Quaker BioVentures, Oak Investment Partners, HealthCap and L Capital Partners. The company had now raised over $140 million in total VC funding.

Raydiance Inc., a Petaluma, Calif.-based developer of ultrafast laser technology and applications, has raised $20 million in Series D funding. Greenstreet Partners led the round, and was joined by return backer Draper Fisher Jurvetson. The company is run by former AOL CEO Barry Schuler, who also is a managing director of DFJ Growth Fund.

Danotek Motion Technologies, an Ann Arbor, Mich.-based developer of energy conversion systems for the energy and transportation markets, has raised $14.5 million in first-round funding. Backers include CMEA Ventures, StatoilHydro Venture and GE Energy Financial Services.

Quantance Inc., a San Mateo, Calif.-based fables chipmaker focused on increasing data speed and battery life in mobile devices, has raised $12 million in Series B funding. TD Fund led the round, and was joined by Docomo Capital and return backers Granite Ventures and InterWest Partners. It had previously raised $6.5 million.

Apptera Inc., a San Bruno, Calif.-based developer of speech recognition solutions, has raised $10.5 million in fifth-round funding. Return backers include Alloy Ventures, Lightspeed Venture Partners and Walden International. The company had previously raised around $25 million.

Knopp Neurosciences Inc., a Pittsburgh-based developer of biomarkers and drug therapy for amyotrophic lateral sclerosis, said that current investors have exercised $6.6 million in Series B2 warrants, bringing the company’s total venture capitalization to $27 million. Backers include Saturn Partners, Kramer Capital Partners and LaunchCyte LLC.

AutoVirt Inc., a Nashua, N.H.-based provider of file virtualization and automation solutions, has raised $4 million in second-round funding from return backers Kepha Partners and Sigma Partners. It has now raised $8.5 million in total funding since its inception last year.

Boxee Inc., a New York-based developer of a “social” media center, has raised $4 million in Series A funding from Spark Capital and Union Square Ventures. Bijan Sabet of Spark and Fred Wilson of USV will join the company’s board of directors.

Azure Power, a solar power producer in India, has raised an undisclosed amount of Series A funding from Helion Venture Partners and Foundation Capital.

FMI NewCoal, a Denver-based developer of low-rank coal upgrade technology, has raised an undisclosed amount on new VC funding led by Emerald Technology Ventures.

Angie’s List, an Indianapolis–based provider of consumer reviews on local service, has raised $18 million in venture debt funding from Lighthouse Capital Partners. Earlier this year, the company raised $35 million from Battery Ventures. Other backers include Aquent and BV Capital.

Buyout Deals

Bay Harbour Management reportedly has hired a liquidation firm to help wind down casual clothing retailer Steve & Barry’s. The shutdown will result in around 5,000 layoffs, and a total investment loss for Bay Harbour and co-investor York Capital Management. Cerberus lending unit Ableco, which financed the Bay Harbour buyout, is expected to be repaid in full.

Chrysler Financial Canada said yesterday that it will close offices across the country, including its Calgary, Montreal and Ontario offices. The moves would affect around 145 employees, although some will be offered relocation to Toronto.

Ireland is in talks with foreign private investors about a plan to inject new capital into the country’s major banks. An Irish Times report suggests that J.C. Flowers may be among the interested firms.

Lance Inc. (Nasdaq: LNCE) has made a $30 million “stalking horse” bid for the assets of snack food company Archway Cookies LLC, a bankrupt portfolio company of Catterton Partners.

Lazy Days RV Center Inc., a portfolio company of Bruckmann, Rosser, Sherrill & Co., has skipped an $8.1 million interest payment to holders of its 11.75% senior unsecured notes due 2012. The move prompted credit ratings downgrades from both S&P and Moody’s. Lazy Days said that it has a 30-day grace period before falling into default, and that it plans to negotiate with its lenders.

PE-Backed IPOs

Grand Canyon Education Inc., a Phoenix-based provider of online post-secondary education services, has again cut the IPO price range for its 10.5 million shares – this time from $16 and $18 per share to $12 and $14 per share. It had originally planned to price at between $18 and $20 per share. Credit Suisse and Merrill Lynch are serving as co-lead underwriters for the offering, which is expected to price this week. Shareholders include Endeavour Capital (32.6% pre-IPO stake).

PE Exits

Ambric, a Beaverton, Ore.-based developer of massively parallel processor arrays, announced that it is for sale. The company has raised around $37 million in VC funding since 2003, from firms like Advanced Equities, Northwest Technology Ventures, OVP Venture Partners and Velocity Interactive Group.

IBM has agreed to acquire Transitive Corp., a Los Gatos, Calif.-based developer of cross-platform virtualization solutions. No financial terms were disclosed. Transitive has raised over $37 million in VC funding since 2000, from firms like Crescendo Venture Management and Meritech Capital Partners.

Multi-Fineline Electronix Inc. (Nasdaq: MFLX) has agreed to acquire Pelikon Ltd., a UK-based developer of printed segmented electroluminescent displays and keypads. The deal is valued at $10.7 million, payable by two-year promissory notes. Milestone-based earn-outs are also included. Pelikon has raised over $23 million in VC funding since 2000, from firms like Advent Venture Partners, Finance Wales, Gartmore Investment Ltd. and Spark Ventures.

Firms & Funds

Calvert Street Capital Corp. has withdrawn registration for a $65 million IPO, which it had filed for in November 2007. The firm provides equity and debt financing to mid-sized companies, and had planned to trade on the Nasdaq.

Evercore Partners has launched a wealth management group, led by former U.S. Trust chairman and CEO Jeff Maurer.

Vanterra Capital has held a $152 million first close on its debut fund-of-funds, and expects to hit its $300 million target early next year. The New York-based firm focuses on opportunities in the lower middle-markets, and is managed by Shad Azimi (former principal with New York Life Capital Partners), Alan Quasha (CEO of Quadrant Management) and Jason Young (managing director of Quadrant Management).

Human Resources

Christopher McFadden has joined Health Evolution Partners to launch a New York office, and as a managing director of the firm’s growth fund. He previously was a managing director with Goldman Sachs.

Luke MacKenzie has joined Close Brothers as a director in the firm’s European restructuring and debt advisory group, with a focus on the real estate sector. He previously was with CB Richard Ellis Real Estate Finance.