peHUB Wire: Monday, July 6, 2009

The sun is shining, the FDIC is playing inexplicable hardball with private equity and the Celtics have another power forward who doesn’t like to play near the basket. In other words, it’s time for Monday Mouth-Off.

Today’s mailbag is based on Friday’s column about the New York pension scandal, including Andrew Cuomo and Pacific Corporate Group:

Theo writes: “I agree that the $2 million is a pretty light punishment… Most importantly it sends the wrong message that as long as you are able to perform well enough you can always purchase a ‘get out of jail free card’ and still net a profit at the end of the year. A sort of retrogressive immunity in exchange for signing a code of conduct and coughing up a fee is a pretty nice deal, I would think. I doubt Carlyle or PCG would be so quick to pay and sign the code if there really is no legal basis.”

Anon: “If Cuomo doesn! ’t have a legal case, but does have the support of public opinion, the best route is to garner sensational headlines with 7 and 8 figure ‘penalties’ being paid by rich guys to refill the coffers of the pension fund, on your march to the governor’s office. When you are not wearing the veil of the NYAG title, demanding payments from private citizens and businesses in exchange for not suffering from aggressive action to your health, safety or the well being of your business has another name…”

DJ: “I find it an interesting display of your reporting biases (or perhaps contempt for Andrew Cuomo) that you appear to give equal weight to an unidentified source that ‘doesn’t believe that Moseley knew anything about the arrangement’ (a friend of his perhaps?) and Moseley’s own proclamation of innocence, versus a two-year investigation by the New York AG’s office which lays out a fact pattern, published with your own article, that shows that Moseley not only knew about th! e payment to Morris, but also lied to his own partners at the time. I kind of doubt the AG’s office came to this conclusion by mere speculation, but rather had some pretty conclusive, corroborating evidence to that effect.”

Quick reply: I can’t speak to the AG’s sourcing, DJ, because his is as anonymous as mine (although I obviously know mine, and have reason to trust them). It would seem to come from Wissman (an admitted con artist), but I can’t say for sure. As I said: If Cuomo has the goods on Moseley, then indict. Or: (a) explain why you aren’t or (b) don’t drag people through the mud without backing it up. Again: I’m thrilled that Cuomo is bringing a lot of dirty secrets out into the open. What I don’t understand is what he’s doing – or, rather, not doing, post-exposition.

Aaron: “I think everyone is paying too much attention to the fines and too little to the code of conduct. It’s the code that will actually affect these firms for years to come, because it could put them at a competitive disadvantage. ! I wonder if this situation will cause firms to think twice before taking money from public pensions in New York.”

Finally, there is James: “So Andrew Cuomo gets money back for public pensioners and you slam him for it? Pathetic sucking up to private equity or an opening shot in support of Rudy Giuliani? Please keep your pro-big business, right-wing political biases out of your reporting.” [it’s ok to chuckle, longer-time readers…]

Top Three

Bridgepoint reportedly is talking with bankers about a possible £700 million floatation of Pets at Home, the UK’s largest pet retailer. Bridgepoint bought Pets at Home for £230 million in 2004.

Hyperion Therapeutics, a San Francisco-based drug company focused on gastroenterology and hepatology, has raised $60 million in Series C funding. Bay City Capital and Panorama Capital co-led the round, and were joined by return backers Highland Capital Partners, New Enterprise Associates and Sofinnova Ventures.

Mike Volpi has joined Index Ventures as a partner in the firm’s London office. He previously was CEO ofonline videocompany Joost,where he will continue to serve as chairman. Joost last week announced major layoffs and a business strategy shift. Joost is an Index portfolio company. Prior to Joost, Volpi oversaw Cisco’s routing and service provider business.

VC Deals

Novacta Biosystems Ltd., a UK-based developer of antibiotics, has raised £13.1 million in new VC funding led by Celtic Pharma.The round is payable upon the achievement of certain milestones.

Pronota NV, a Belgium-based developer of protein biomarker diagnostics, has raised €4.9 million in the first close of its Series B round. VIB was joined by return backers LSP, Gimv, Biotech Fund Flanders, KBC Private Equity, Johnson & Johnson Development Corporation and Baekeland Fund.

InfoNow Corp., a Denver-based provider of SaaS-based channel data services, has raised $5 million in Series B funding. Vedanta Capital led the round, and was joined by return backers Sequel Venture Partners and Sevin Rosen Funds. Info! Now raised a $6 million Series A round in late 2007.

SpineGuard, a developer of medical devices to improve the safety of spinal surgery, has raised $4 million inadditionalfirst-roundfunding from Delta Partners. The total round now stands at $11 million, including initial participation by Crédit Agricole Private Equity, Innoven Partenaires and A Plus Finance. SpineGuard has offices in Paris and San Francisco.

Buyouts Deals

Centrum Equities and Wynnchurch Capital have agreed to acquire bankrupt auto parts supplier Proliance International Inc., for $21.5 million.

Golden Gate Capital has completed its acquisition of the J. Jill apparel brand from The Talbots Inc. (NYSE: TB) for approximately $75 million.

Hopu Investment Management, a private equity fund partially backed by Goldman Sachs, is in talks to acquire a 20% stake in China Mengniu Dairy (2319.HK) for around $800 million. Hopu’s partner on the deal would be China National Oils, Foodstuffs and Cereals Corp.

Onex Corp. has acquired a majority stake in the Tropicana Las Vegas Hotel! and Casino, as part of Tropicana’s emergence from bankruptcy protection.

MatlinPatterson Global Advisors may lead a recapitalization offer for Nortel Networks, according to The Financial Times.

Wilbur Ross is considering a bid for the assets of bankrupt auto parts maker Delphi Corp. Hedge fund Elliott Management also is prepping a bid for Delphi, which previously agreed to be acquired by Platinum Equity.

PE-Backed M&A

Access Intelligence LLC, a Rockville, Md-based B2B information and marketing company, has acquired Contexo Media, a Salt Lake City-based provider of medical coding and reimbursement books and software to the medical billing industry. No financial terms were disclosed. Access Intelligence is a portfolio company of Veronis Suhler Stevenson.

Baxi, a UK heating products company backed by BC Partners, has agreed to merge with Dutch rival De Dietrich Remeha. The deal would create Europe’s third-largest boiler maker.

Danoo, a digital location-based media network with interactive video screens in retail locations, has ac! quired IdeaCast, a provider of captive television advertising. No financial terms were disclosed.Minority shareholders in the combined company will include Danoo backer Kleiner Perkins Caufield & Byers and previous IdeaCast owner National CineMedia LLC.

Emdeon, a provider of revenue and payment cycle management solutions for the healthcare industry, has acquired eRx Network LLC, aprovider of electronic pharmacy healthcare solutions. No financial terms were disclosed. Emdeon is in registration for a $460 million IPO, and is backed by General Atlantic and Hellman & Friedman.

i2, a UK-based provider of intelligence and investigation management software, has agreed to acquir! e Tucson, Ariz.-based Knowledge Computing Corp. No fi nancial terms were disclosed. i2 is a portfolio company of Silver Lake Partners, while Knowledge Computing raised a small amount of VC funding from firms like Primus Management and Diamond State Ventures.

Intermedix Corp., provider of billing services to emergency medical service providers in Texas, has acquired Alexander Billing and Consulting, a San Antonio-based provider of EMS billing services. No financial terms were disclosed. Intermedix is a portfolio company of Parthenon Capital.

Medifacts International Inc., a Rockville, Md.-based cardiovascular core lab, has acquired the Clinical Trials Services unit of Spacelabs Healthcare Inc. No financial! terms were disclosed. Medifacts has raised around $22 million from Ampersand Ventures and SV Life Sciences.

PE Exits (Nasdaq: TREE) has acquired certain assets of Done Right, a Pasadena, Calif.-based online directory servicethat provideshome improvement professionals withlead generation and marketing services. No financial terms were disclosed. Done Right had raised around $5 million from August Capital and Mohr Davidow Ventures.

Firms & Funds

Kleinwort Benson management has lined up UK individual investors to back a buyout bid from Commerzbank AG.

Human Resources

Wilson Feng, a former senior banker for Merrill Lynch, has been chosen to run China’s newly-formed $1.46 billion nuclear investment fund.

Roger Krakoff has left Sigma Partners, where he has spent the past five years as a venture partner. VentureWire reports that Krakoff is launching his own Boston-area VC firm, with fundraising having already begun. Prior to joining Sigma, Krakoffwas a general partner with JEGI Capital and a managing directorwith Veronis Suhler Stevenson.

Ryan Sweeney has joined Accel Partners as a partner focused on growth equity investments. He previously was a principal with North Bridge Venture Partners and, before that, with Summit Partners.