peHUB Wire: Tuesday, December 22, 2009

Today’s scheduled column didn’t quite some together in time, as I need to speak to someone on the West Coast who isn’t yet answering his phone. One of those things I’m 99% sure about, but the 1% would have some ramifications if it came to pass. So, in the meantime, a few notes:

*** Back in October, we mentioned that Sequoia Capital is planning to consolidate most of its different funds into a single vehicle for the next go-around. VentureWire moved the story forward yesterday, saying that the combo vehicle is being marketed with a $1 billion target and a 30% carried interest. It would include all of Sequoia’s early-stage efforts and China efforts (Israel, growth-stage and public are apparently excluded).

LP reaction has been fairly muted so far, ! with investors telling me that they hope to get a better understanding of the change during Sequoia’s next annual LP meeting, taking place on January 13-14 in Beijing.

*** Yesterday, we noted that Etsy, an online marketplace for buying and selling handmade products, had acquired ad platform operator Adtuitive. No financial terms were disclosed, but we understand it was an 8-figure cash/stock transaction.

Also, as an addendum, we mentioned that Etsy was VC-backed (Accel & Union Square), but neglected to mention that Adtuitive raised an undisclosed amount of funding from .406 Ventures.

*** ReachLocal, a provider of online ad solutions for local businesses, yesterday filed for a $100 million IPO. Worth noting that one of the company’s shareholders is Galleon Group, based on its participation in a $55.2 million Series D round in October 2007. There is no mention of Galleon’s troubles in the S-1…

*** My corporate overlords are taking some blog heat today, for allegedly killing off a story related to possible insider-trading in the 1980s by SAC Capital’s Steve Cohen. A reader emailed for my thoughts, which are threefold: (1) I have no idea if the story is true, since I work in a home office cocoon; (2) If true, the heat appears to be deserved; (3) Thomson Reuters has been a far better editorial master than was Thomson Financial, which panicked ! and caved every time someone even threatened legal action. One time I had to remove the word “scandal,” in reference to a public official who had been convicted of fraud (not a joke). That’s just my own experience, but figure it should be put out there.

*** Yesterday I called a VC firm on the West Coast, and got a message telling me to “Press one for Joe, press 2 for John, etc.” When I did so, however, neither Joe nor John had working voicemails. I had heard that the firm was basically defunct, and this seemed like de facto confirm (although I’m going to try again today, just in case it was a tech malfunction).

Reminds me that I’m late on a new version of the VC Walking Dead. If you know of a VC firm that can no longer make new investments, please drop me a note with specifics (your emails, as always, are confidential). Remember, these firms may be able to support existing portfolio companies, they just can’t add new ones.

Top Three

J.F. Lehman & Co. has sold Atlantic Intertial Systems to Goodrich Corp. for approximately $375 million in cash. AIS is a Cheshire, Conn.-based provider of guidance, stabilization and navigation products and systems for the global defense market. It was acquired by J.F. Lehman from BAE Systems in August 2007, in a deal that included $145 million of equity.

Ambit Biosciences and Astellas Pharma have agreed to jointly develop and commercialize ! FLT3 kinase inhibitors in oncology and non-oncology indications. Under the terms of the agreement, Ambit will receive an up-front cash payment of $40 million and will be eligible to receive pre-commercialization payments of up to $350 million. San Diego-based Ambit has raised over $100 million in VC funding, from MedImmune Ventures, OrbiMed Advisors, Radius Ventures, NovaQuest, Horizon Technology Finance, Perseus-Soros Biopharmaceutical Fund, Forward Ventures, Avalon Ventures, Roche Venture Fund, GIMV, Jov-CMDF and Genechem.

ReachLocal Inc., a Woodland Hills, Calif.-based provider of online advertising solutions for local businesses, has filed for a $100 million IPO. J.P. Morgan and BoA Merrill Lynch are serving as co-lead underwr! iters. The company reports over $143 million in revenue for the first nine months of 2009, compared to around $100 million over the same period one year ago. Its net income for the 2009 periodis $11.66 million, compared to a $4.47 million loss in 2008. ReachLocal raised around $68 million in VC funding, from VantagePoint Venture Partners (53.22% pre-IPO stake), Rho Ventures (12.94%) and Galleon Group (6.76%).

VC Deals

MobGold, a China-based provider of mobile advertising and mobile transaction solutions, has raised $12 million in Series B funding from Fast Global Investments.

LiveMocha Inc., a Bellevue, Wash.-based provider of online language education, has raised $8 million in Series B funding. August Capital led the round, and was joined by return backer Maveron. The company previously raised nearly $6 million.

Buyouts Deals

Citigroup said it was not seeking buyers for EMI, the UK-based music group whose owners, Terra Firma Capital Partners, are suing Citigroup for billions of dollars in damages related to its 2007 buyout.

Versa Capital has sponsored a recapitalization of Allen-Vanguard Corp., an Ottawa, Canada-based provider of protection hazardous devices for the military and homeland security markets. No financial terms were disclosed.

WestView Capital Partners has acquired a minority equity position in VaultLogix, a Danvers, Mass.-based provider of online data backup and disaster recovery services to the SME market. No financial terms were disclosed. VaultLogix previously raised funding from London Bay Capital.

PE-Backed IPOs

Smile Brands Group Inc., a Santa Ana, Calif.-based provider of support services to dental groups in the U.S., has filed for a $143.75 million IPO. It plans to trade on the NYSE, with Credit Suisse and Jefferies & Co. serving as co-lead underwriters.The company reports around $341 million in revenue for the first nine months of 2009, compared to $333 million during the same period in 2008. Private equity firm Freeman Spogli & Co. holds a 77.3% pre-IPO ownership position. Other shareholders include CalSTRS (9.8%), Gryphon Investors (6.5%) and ASF Co-Investment Partners (6.5%).

PE-Backed M&A

Deltagen Inc. (OTC BB: DGEN) has acquired Benten BioServices Inc., a provider ofmanufacturing and testing services for the pharma development market. As part of the deal, Penn Venture Partners and Life Sciences Greenhouse invested approximately $1.5 million in the combined company.

Pinch Media of New York has agreed to merge with San Francisco-based Flurry, in order to form a combined provider of mobile data analytics. No financial terms were disclosed. Pinch Media has raised an undisclosed amount of seed funding from Union Square Ventures, First Round Capital, Sharkey Goldstein Capital, Dave Morgan, Jerry Neumann and Mike Yavonditte. Flurry is backed by nearly $4 million from Borealis Ventures, Draper Fisher Jurvetsonand Village Ventures. News of the deal was first reported by VentureBeat.

Six3 Systems Inc., a provider of national security and defense intelligence services, has acquired BIT Systems Inc., a provider of intelligence, surveillance, and reconnaissance solutions. No financial terms were disclosed. Six3 Systems is a portfolio company of GTCR, and was advised on the deal by Cook Associates.

Transilwrap, a portfolio company of Nicolet Capital Partners, has acquired Quest Films Inc., a Woodstock, Ill.-based maker and distributor of thermal laminating folks. No finanjcial terms were disclosed.

PE Exits

Limelight Networks Inc. (Nasdaq: LLNW) has agreed to acquire EyeWonder Inc., an Atlanta-based provider of leading provider of interactive digital advertising products and services. The deal is valued at approximately $110 million, including $62 million in cash and approximately 12.74 million shares of Limelight common stock. There also is an earn-out of 4.86 million additional shares based on financial milestones. EyeWonder raised an undisclosed amount of growth equity in 2007 from BIA Digital Partners.

Firms & Funds

Almaz Capital, a VC firm focused on early-stage tech opportunities in Russia and CIS,has received a $30 million fund commitment from the European Bank for Reconstruction and Development. It had held a $60 million first close last year, with Cisco Systems as its anchor LP.

Human Resources

Credit Suisse has named Boon Sim head of its global M&A business. He had been in charge of Americas M&A, and succeeds Marc Granetz.

Charles Mather has joined Janney Montgomery Scott as managing director in charge of private placements and alternative capital. He previously was a managing director and head of structured equities at Jefferies & Company.

Sam Renwick has joined The Salter Group, as a San Francisco-based managing director in the advisory firm’s life sciences practice. He previously was a managing director with SVB Analytics.

Brian Hogan has joined the I-banking group of Broadpoint Capital, a broker-dealer subsidiary of Broadpoint Gleacher Securities Group, as a managing director. He previously spent 17 years with Boa Merrill Lynch, most recently as global head of the building and construction industry group.