peHUB Wire: Thursday, November 19, 2009

Greetings from Beverly Hills, where later today I’ll be moderating a pair of panels at the Buyouts West conference. Some quick hits to kick things off:

*** The Senate Committee on Commerce, Science and Transportation last week released a staff report on “aggressive sales tactics on the Internet.” The focus is on companies that essentially sign you up for paid services you didn’t realize you had purchased until the credit card bill comes due (often by pre-selecting an extras box during checkout of legit online retailers).

To say the least, the report is not terribly kind to the three companies it focuses on: Affinion, Vertrue and Webloyalty. What do all three have in common, beyond corporate headquarters in Connecticut and sleazy business practices? They’re all owned (or partially owned) by private equity firms…

*** The next test for LBO-backed IPOs was supposed to come thi! s week with HealthPort, but word just came in that it has pulled the offering. No explanation yet.

*** Lots of renewed rumors yesterday of a potential acquisition offer for online classifieds company Monster Worldwide, based on massive options volume and a corresponding share price bump. Conventional wisdom is that this is just the result of reheated News Corp. talk, rather than any private equity interest.

*** Oak Hill Capital Partners yesterday denied reports that it is interested in buying Playboy Enterprises (which sent the company’s stock even lower). This comes on the heels of a similar denial by Golden Gate Capital. Either these firms walked away after due diligence, or someone close to the skin mag is desperate to create the impression of a bidding war.

*** Todd Jaquez-Fissori has joined venture debt lender Hercules Technology Growth Capital as a managing director in the firm’s Palo Alto office. H e had spent some time last year with TriplePoint Capital, and before that spent four years as a managing director with Siemens Venture Capital.

*** Credit creep: Blackstone’s purchase of Birds Eye from Vestar comes at an EBITDA multiple of approximately 5.5x.

*** Yesterday I met with a Los Angeles-based venture capitalist, who said one of the most significant problems faced by SoCal investors is having their best local deals poached by NoCal investors.

*** Speaking of LA: Cabs here are way to expensive, and their system for handling credit cards is brutally antiquated.

*** Particularly interested in this morning’s keynote from Mark Attanasio, a managing director with TCW. He recently spearheaded the formation of a joint venture between Magic Johnson Enterp! rises and TCW that will provide credit to middle-market businesses. Also want to know if the Milwaukee Brewers, which Attansio owns, will trade Prince Fielder to the BoSox…

Top Three

Vestar Capital Partners has agreed to sell frozen vegetable producer Birds Eye Foods to Pinnacle Brands Corp., a portfolio company of The Blackstone Group, for approximately $1.3 billion. Birds Eye is currently in registration for a $350 million IPO, and reported around $935 million in revenue for the year ending June 30, 2009.

American Express Co. has agreed to acquire Revolution Money, a St. Petersburg, Fla.-based provider of secure payments through an Internet-based platform. The deal is worth approximately ! $300 million. Revolution Money had raised around $100 million, from fi rms like Goldman Sachs, Morgan Stanley, Citigroup, Deutsche Bank and Steve Case’s Revolution LLC.

Manthan Systems, an India-based provider of business intelligence and analytics for the retail and consumer packaged goods industries, has raised up to $15 million in Series B funding. Fidelity International led the round, and was joined by return backers IDG Ventures India and ePlanet Ventures.

VC Deals

PicoChip, a Bath, England-based provider of signal processing products for wireless communications, has raised $20 million in Series E funding. Backers include Atlas Venture, Highland Capital Partners, Pond Venture Partners, Scottish Equity Partners, Rothschild, AT&T, Intel and Samsung The company previously raised over $64 million.

Zeno Corp. (f.k.a. Tyrell), a Houston, Texas-based developer of a handheld device to treat acne, has raised $20 million in new VC funding, according to a regulatory filing. The round includes $6 million in cash and $14 million for “services to be rendered.” Return backers include Austin Ventures, Catterton Partners and Sante Ventures., a Los Angeles-based online shopping assistant fo! r shoes, has raised $7 million in venture capital funding, according to a regulatory filing. No investors were listed. The only non-executive board member listed is celebrity attorney Robert Shapiro.

Axxana, an Israeli developer of data disaster recovery solutions, has raised $9 million in Series B funding. Carmel Ventures led the round, and was joined by return backers Gemini Israel Funds and Moshe Yanai.

GettingHired LLC, a Bedminster, N.J.-based company that provides career services to people with disabilities, has raised $3 million in new VC funding. Backers includeZenith Insurance Co., Kamine Development Corp and Fisher Capital Corp.

Immunet, a Palo Alto! , Calif.-based developer of anti-virus technologies, has raised $2 mil lion in Series A funding. Altos Ventures led the round, and was joined by Atlanta-based TechOperators.

ClearMomentum, a Rochester, N.Y.-based provider of, has raised an undisclosed amount of Series A funding led by Trillium Group.

Buyouts Deals

Astorg Partners has agreed to sponsor a leveraged recap of French insurance broker Gras Savoye & Cie, in partnership with current Gras Savoye shareholder Willis Group Holdings Ltd. (YSE: WSH). Astorg would receive 33% of voting rights in Gras Savoye, which is being valued at$343 million.

The Blackstone Group has held informal talks with Citigroup over its auto loan unit Citi! Financial Auto, according to the NY Post.

Breyers Yogurt Co., a portfolio company of Catterton Partners, has received a new senior debt facility from Golub Capital. No financial terms were disclosed.

Deutsche Telekom has agreed to buy Freenet’s Strato web-hosting unit for €275 million in cash. Other bidders had included Bridgepoint Capital.

Metalmark Capital has agreed to partner with Northeast Natural Energy on a joint venture to pursue natural gas drilling, exploration ! and acquisition in the Marcellus Share. No financial terms were disclo sed.

One Equity Partners and Nokia Siemens Networks have jointly bid for Nortel Networks Corp.’s optical networking and carrier ethernet business. This is a rival offer to a $526 million offer from Ciena Corp.

Palladium Equity Partners has agreed to buy the DolEx and Europhil money transfer businesses of Global Patments Inc. (NYSE: GPN), for between $85 million and $110 million.

PE-Backed M&A

Adknowledge, a Kansas City-based provider of behavioral online advertising solutions, has acquired the primary assets of SocialMedia Networks, a San Francisco-based provider of a social media ad platform. No financial terms were disclosed. Adknowledge raised $48 million in funding in 2006 from Technology Crossover Ventures. SocialMedia Networks had raised VC funding from Charles River Ventures, IDG Ventures SF, Marc Andreessen and Jeff Clavier.

Firms & Funds

BioStar Ventures, a firm focused on early-stage medical device startups, is looking to raise $75 million for its second fund, according to VentureWire. The Michigan-based firm has already secured $30 million, and expects to hold a final close next year.

Maveron LLC, a Seattle-based VC firm, is opening an office in San Francisco. It will be led by partner Amy Everett. Also in the office will be new principal Ben Choi, who recently joined Maveron from Storm Ventures.

Human Resources

Nate Westheimer has joined Flybridge Capital Partners as an advisor, while continuing to serve as co-founder and executive vice president of product and technology at AnyClip. Prior to AnyClip, Westheimer was an entrepreneur-in-residence with Rose Tech Ventures.