peHUB Wire: Monday, June 8, 2009

Greetings from New York City, where I’m prepping for tomorrow’s LP Congress. We’ll have more than 75 endowment/fund-of-funds/foundation/pension/etc. managers crowded into Bond Street restaurant for a day of discussion groups and networking, interspersed with sushi and sake.

All off-the-record (sorry), but hopefully an opportunity for LPs to forge a better sense of community in order to tackle the serious issues that most all of them face. Special thanks to sponsors Coller Capital and Parish Capital, for making the event possible.

*** Chicago Shindig: In one week from tonight, peHUB will return to The Windy City for an evening of cocktails and conversations with local private equiteers, venture capitalists and assorted hangers-on. It’s taking place at English, which is located at 444 N La Salle Blvd.

This is ! obviously very short notice, so get your tickets today. Per usual, they cost just $10, with proceeds going to a charity that will be selected by event attendees (you can nominate a charity when you register). Click here for more info and tickets.

Big thanks to Bank of Ireland and Crowe Howarth for stepping up as sponsors.

*** We reported in this space a while back that Mohr Davidow Ventures was in the market for some annex funds, in order to better support existing portfolio companies. Nothing surprising there (annex funds are the new black), except that one of the annexes would be for a fund that MDV actually shrunk after the Internet bubble burst.

I believe this would be the first time that a fund was raised, cut and then expanded. Wonder if whiplashed LPs will be as eager to add on as they were to cut back. Also wonder how “reduced” funds have performed in ! relation to same-vintage funds that kept their original sizes. Could b e an important data point, given all the talk from small funds about how venture loses its edge with too much capital in the bank. Adding to the storyboard…

*** Quote of the Day I comes from Brian Jinkens of Cogent Partners, which just released a white paper on PE valuations and cash flows in 2008 as compared to 2007: “We were surprised to see that the median private equity fund was only marked down 17.6% during 2008, compared to a much larger decrease in the public markets. This would indicate that general partners are being too conservative in their write downs.”

*** Quote of the Day II comes from Bob Grady of The Carlyle Group, in a conversation with the NYT’s Claire Miller about the carried interest taxation issue: The battle “is 90 percent of the way to lost.”

Top Three

AIG has picked an investor consortium that includes Onex Corp. and Greenbriar Equity Group as the preferred bidder for its ILFC aircraft leasing busin! ess.

UQ Communications, a Japanese provider of WiMAX services in Japan, has raised $43 million from Intel Capital.

KKR and Fidelity Investments have signed a deal whereby Fidelity’s retail and institutional brokerage clients would have the opportunity to participate in IPOs and follow-on offerings underwritten by KKR’s capital markets group.

VC Deals

Aileron Therapeutics, a Cambridge, Mass.-based developer of cell-permeable peptide technology to help treat cancer, has raised $40 million in new VC funding. Excel Medical Ventures and SR One co-led the round, and were joined by Lilly Ventures, Roche Venture Fund and return backers Apple Tree Partners and Novartis. The company had previously raised $21 million.

Buyout Deals

Bain Capital has agreed to buy a 20% stake in GOME (HK: 0493), a Chinese home appliance retailer. Various reports value the deal at between $200 million and $400 million.

Clear Channel Commun ications is confident of reaching and agreement with its lenders on a debt restructuring, according to an FT interview with Clear Channel’s international chief William Eccleshare. Clear Channel is owned by Bain Capital and THL Partners.

Entrust (Nasdaq: ENTU), a Dallas–based company that secures digital identities and information for consumers, reiterated its recommendation that shareholders vote in favor of a $114 million buyout by Thoma Bravo, after no superior offer emerged during a “go-shop” period. Entrust stockholders w! ould receive $1.85 per share.

NXP BV, a Dutch semiconductor company, said that it may be forced to restructure its debt due to dwindling cash reserves. NXP is owned by Apax Partners, Bain Capital and KKR.

Penske Automotive Group has agreed to buy the Saturn brand from General Motors. No financial terms were disclosed.

Safilo (Milan: SFLG), an Ita lian eyewear maker, is expecting buyout offers from private equity funds to come shortly.

Silverfleet Capital (fka PPM Ventures) is close to securing debt financing to acquire Kalle Nalo, a German maker of sausage casings, from Montagu Private Equity. Pampalona Capital has also been named as a possible buyer.

Sopra Capital has acquired Provo, Utah-based the parent comp! any of quick-serve restaurants Hogi Yogi, Teriyaki Stix and Yoasis Brands. No financial terms were disclosed.

PE-Backed M&A

Apollo Global, a portfolio company of The Carlyle Group, has offered to buy UK education and training company BPP (LSE: BPP) for £303.5 million, or 620 pence per share (70% premium to April 28 closing price, which was a day before BPP announced Apollo’s approach).

PE Exits

3i Group has scrapped plans to sell a majority stake in Franklin Offshore International, a Singapore-based oil services company. The firm had received bids of up to $250 million for the stake (5x EBITDA), but had been seeking more.

Firms & Funds

Broadpoint Securities Group has completed its acquisition of Gleacher Partners, forming a new company called Broadpoint Gleacher Securities Group (Nasdaq: BPSG).

Barclays is nearing a deal to sell its Barclays Global Investors asset management unit to BlackRock.

First Vanguard, a Hong Kong-based asset manager, plans to form a $100 million fund with film producer Raymond Wong, to invest in movies and TV programs targeting the Chinese market.

Human Resources

Ken Leet has stepped down as head of European operations for Cerberus Capital Management, according to Dow Jones. Also gone is Jeff Lubin, with Cerberus reportedly cutting one-third of its UK staff so far this ye! ar.

Bob Wigley has joined Advent International as an operating partner, with a focus on financial services opportunities in Europe. He had spent the past decade with Merrill Lynch, most recently as head of chairman of Merrill Lynch Europe, Middle East and Africa.