peHUB Wire: Friday, July 10, 2009

After finishing yesterday’s column on private equity’s absence from the PPIP manager list, I called up the Treasury Department for a list of those who submitted “over 100 unique applications.” My goal was to find out if PE firms had indeed been interested, or if most of the rejectees were crackpot lounge singers who don’t know CDS from CPR.

Unfortunately, Treasury refused to play nice. A Department spokesman simply said “no,” when I asked, without providing an official reason. We could speculate that Treasury doesn’t want to cause reputational damage to the losers, but the government hasn’t objected to identifying losing bidders for failed banks. So that couldn’t/shouldn’t be it.

Maybe Treasury is worried that if the program fails, critics might suggest that some of the losing bidders would have done a better job than the winning bidders. Or maybe, just maybe, PPIP wasn’t quite as popular as Treasury would like us to believe. After all, if PIMCO bailed, why ! not Carlyle?

In the end, though, this is a public program and taxpayers have the right to know both the winners and the losers. A pretty website doesn’t make up for a lack of transparency.

That’s why our legal whizzes have drafted a FOIA request, and will be sending it out later today. Sadly, even if the FOIA is accepted, it would still take months to get the list…

*** It’s been a while since I’ve seen a venture capitalist on CNBC (or myself for that matter – ‘sup with that?), and I’m not sure I’ve ever seen one disclose a new deal during a live interview. But that seems to have been what happened yesterday morning, when Erin Burnett interviewed RRE Ventures’ Jim Robinson IV from Sun Valley (video here).

In response to a question about deal activity, Robinson said that RRE had just participated in a new round for Revolution Money, a person! al payment startup that previously raised nearly $100 million from Ste ve Case, Ted Leonsis, Goldman Sachs, Citigroup, Morgan Stanley and others. Robinson said the new deal was for between $15 million and $20 million.

As an aside, Burnett neglected to ask Robinson about the collapse of airline security company Clear, even though he was an investor and on the board…

*** A regulatory filing indicates that Sterling Partners’ growth equity investment in Paul Green School of Rock Music was for $10 million.

*** New VC Fund Alert: Jarvinian Venture Fund is raising $150 million for its debut vehicle, which will focus on early-stage wireless opportunities. The Boston-based firm’s team includes: Chris Carter, former general partner with Sherbrooke Capital; John Dooley, founder of Novatics; and Tom Eddy, former COO at Atlas Venture.

*** Of interest only to me: If you go to the team page of Huntsman Gay’s website, the first name that pops u! p is associate Tanner Ainge, son of Celtics GM Danny Ainge.

*** Quiz Time I: Can you name the public pharma company that today is accepting first-round buyout bids? Hint: Market cap in excess of $1 billion.

*** Quiz Time II: Can you name the digital media company that recently raised around $30 million in new VC funding? Hint: It’s made some notable news within the past week.

*** Have a great weekend…

Top Three

Infineon, a struggling German chipmaker, plans to raise €725 million in new capital, via a rights issue of up to 337 million shares. Apollo Management has agreed to buy all the shares not taken by existing investors, which could give it up to a 29% ownership stake.

FiberNet Telecom Group Inc. (Nasdaq: FTGX) said that RCN Corp. has withdrawn a $12.50 per share buyout offer. Consequently, the company will persue an $11.45 per share offer from Zayo Group, a Louisville, Colo.-based regional provider of fiber-based network services. The total deal would be valued at around $86 million. Zayo has raised around $225 million inprivate equityfunding, from firms like Morgan Stanley Alternative Investment Partners,Charlesbank Capital Partners, Battery Ventures, Centennial Ventures, Columbia Capital, M/C Venture Partners and Oak Investment Partners.

Gary Crittenden has joined Huntsman Gay Global Capital as a managing director. He most recently as chairman of Citi Holdings, and before that served as CFO for Citigroup, American Express, Sears roebuck and Monsanto.

VC Deals

Presidio Pharmaceuticals Inc., a San Francisco-based drug company focused on small-molecule compounds to treat HIV-1, HCV and other chronic viral infections, has raised $27 million inadditional Series B funding. The round now stands at $53 million.New Leaf Venture Partners was joined on the tranche by return backers Panorama Capital, Baker Brothers Investments, Ventures West Capital, Bay City Capital, Nexus Medical Partners and Sagamore BioVentures.

Borqs Inc., a Beijing-based developer of open-source mobile software for wireless service providers, has raised $17.6 million in Series B funding. Norwest Venture Partners led the round, and was joined by return backers GSR Ventures and Keytone Ventures. The company previously raised around $6 million.

Medivance Inc., a Louisville, Ky.-based developer of therapeutic temperature management products for treating critically-ill patients, has raised around $8 million in new VC funding, according to a regulatory filing. It previously raised around $55 million over four funding rounds, from firms likeMDY Healthcare, Cross Atlantic Partners, Camden Partners, Skyline Ventures and Partisan Management.

Helixis Inc., a Carlsbad, Calif.-based developer of nucleic acid analysis tools, has secured $5.5 million of a $6.5 million round, according to a regulatory filing. It previously raised $10 million in Series A funding from Advanced Technology Ventures, Domain Associates and Okapi Venture Capital.

Qik, a San Mateo, Calif.-based mobile video broadcasting service, has raised around $5.5 million i! n new VC funding (including $1.8m as a note conversion), according to a regulatory filing. Quest Venture Partners was the only listed investor. The company previously raised two rounds of funding from Marc Andreessen, Ben Horowitz, Marc Benioff (Salesforce), Arjun Gupta (Telesoft Partners) and George Garrick (Jingle Networks).

Terracotta Inc., a San Francisco-basedprovider of solutionsto optimize scaling and availability of J2EE applications, has secured $5.5 million of a $6.5 million funding round, according to a regulatory filing. The company previously raised $29 million from firms like Accel Partners, Benchmark Capital and DAG Ventures. No new investors were listed.

Blazent Inc., a San Mateo, Calif.-based provider of IT intelligence for IT outsourcers, has raised around $4.5 million in new VC funding, according to a regulatory filing. It had previously raised around $28 million, fro! m firms like Bain Capital Ventures, Benchmark Capital, FirstMark Capital, Brookside Management, Keynote Ventures, SV Life Sciences and StarVest Partners.

Telligent, a Dallas-based maker of social computing solutions and business intelligence tools, has raised $4.5 million in new VC funding, according to a regulatory filing. It had previously raised $20 million from Intel Capital.

Experience Inc., a Boston-based online employment site for entry-level jobs and internships, has secured $4.4 million of a $5.4 million funding round, according to a regulatory filing. The company reports revenue of between $5 million, and previously raised over $50 million from firms like Polaris Venture Partners.

WordNik, a New York-! based Internet startup from lexicographer Erin McKean, has raised $3.7 million innew VC fundingfunding, according to a regulatory filing. Board members include past backersSteve Anderson (Baseline Ventures) and Roger McNamee (Silver Lake Partners). McKean is the former Chief Consulting Editor for American Dictionaries at Oxford University Press and was Principal Editor of The New Oxford American Dictionary (2nd edition).

GumGum Inc., a Santa Monica, Calif.-based licensing and distribution platform for content online, has raised $2.6 million in new VC funding, according to a regulatory filing. It previously raised a Series A round from Crosscut Ventures and First Round Capital.

Scoperta Inc., a San Diego-based developer of fabless specialty steel technologies utilizing scrap materials, has secured $1.4 million of a $1.8 million funding round, according to a regulatory filing. Existing shareholde! rs include Enterprise Partners Venture Capital. The company does not have a website.

Buyouts Deals

Oak Hill Capital Partners has agreed to make a $125 million preferred equity investment in Duane Reade Holdings Inc., a drug store chain that Oak Hill bought for $700 million in 2004.

Silverfleet Capital reportedly is in talks to buy Kalle Nalo, a German maker of sausage casings, from Montagu Private Equity. The deal would be valued at approximately $350 million.

Thoma Bravo has increased its buyout offer for Entrust (Nasdaq: ENTU), from $1.85 per share to $2 per share. The move increases the deal’s size from $114 million to $124 million, and Thoma Bravo would receive a $2 million termination fee if Entrust shareholders reject the offer. Entrust is a Dallas–based company that secures digital identities and information for consumers.

PE-Backed M&A

Merck & Co. (NYSE: MRK) has bought exclusive rights from Portola Pharmaceuticals, to develop and commercialize an oral blood thinner, used to prevent strokes in patients suffering from atrial fibrillation. The deal includes a $50 million up-front payment, plus up to $420 million in milestone-based earnouts. It comes just months after Portola signed a similar deal with Novartis, for an anti-clotting agent, valued at up to $575 million.

Portola has raised around $220 million in VC funding, from firms like Abingworth Management, Advanced Technology Ventures, AllianceBernstein, Alta Partners, Brookside Capital, CIDC Consulting, D.E. Shaw, Frazier Healthcare Ventures, Goldman Sachs, IBT Management Corp., MPM Capital, Prospect Venture Partners, Sutter Hill Ventures, Teachers’ Private Capital, T. Rowe Price, Apothecary Capital, Janus Capital and PAC-Link BioVentures.

PE Exits

Digi International Inc. (Nasdaq: DGII) has acquired MobiApps Holdings, a Herndon, Va.-based developer of machine-to-machine communications solutions. No financial terms were disclosed. MobiApps had raised around $18 million in VC funding, from firms like Intel Capital, Green DotCapital, UOB Venture Managementand 3i Group.

Firms & Funds

PROfounders Capital has held a first close on its inaugural VC fund. No financial information was disclosed. The London-based firm also announced that it has added Sean Seton-Rogers, formerly an associate with Balderton Capital, as a general partner. Other existing team members include Bebo founder Michael Birch, founder Brent Hoberman, LongAcre Partners founder Jonathan Goodwin and Oakley Capital founder Peter Dubens.

Human Resources

Insight Equity has promoted Eliot Kerlin to principal. He joined the firm in 2005, and manages its investment in RV component maker Atwood Mobile Products.