peHUB Wire: Wednesday, February 24, 2010

Greetings from Beaver Creek, where the sky is bright and the snow is like my favorite part of a doughnut. Really need to hit the slopes at some point today. First, however, I’ll be participating in the VC in the Rockies conference, opining on the merits and demerits of some presenting startups (pity them, being at my uneducated whim). So just a few very quick hits before heading out…

*** I’ve complained repeatedly in this space about CalPERS not releasing the carrying values of its investments in the management companies of Apollo, Carlyle and Silver Lake Partners. The numbers still won’t be published until the Annual Investment Report comes out in March or April, but CalPERS did send over my requested data on Monday. Maybe Joe Dear knew it was my birthday…

You can get the numbers here. They aren’t pretty! .

*** Just thinking aloud: There are going to be a number of VC-backed cleantech “hits” that likely would have been misses without significant government intervention (think A123). Good for the VCs and their investors, but it raising a question: Will such VCs look back on such deals and say, ”Wow, we made a bunch of mistakes but got bailed out.” – or will they say: “Wow, we’re really good at this cleantech stuff.”

The former could lead to smarter investments going forward. The latter could be disastrous. Imagine if mee-too dotcom investments in 2001 had gotten a federally-funded reprieve…

*** Interesting that the first place we’re seeing significant PE market consolidation is among funds-of-funds. First Pantheon Ventures and now Northgate. One-offs? Or a trend?

*** Seems it was one year ago that we publ! ished our Walking Dead VC list, perhaps because there were so many fro m Colorado. I promise another one shortly. If you know of one — an operating firm that cannot make new investments — please let me know.

*** One reason I’ve got no original reporting for today’s column is that I spent most of yesterday on a plane without Internet access. Endlessly frustrating from a business travel POV – either go to a city where Virgin flies, take a red-eye or get behind on your work.

I made this complaint over the summer to the CTO of a major airline, who told me the following: His airline plans to outfit its entire fleet with WiFi, but that each outfitted plane actually loses money. Specifically, the cost of installation and maintenance far outweighs what the airline generates in usage fees. He added that his airline had not yet determined if indirect revenue – me choosing an airline because it has Internet access – made up for the direct shortfall.

*** Erin will be taking care of Thursday and Friday’s peHUB Wires. Be back Monday, from the home office…

Top Three

Enerkem Technologies Inc., a Montreal-based provider of synthetic gass and other alternative fuels, has raised C$53.8 million in new VC funding. Waste Management Inc. was joined by return backers Rho Ventures, Braemar Energy Ventures, BDR Capital and Cycle Capital. Last month, Enerkem was selected by the U.S. Department of Energy to receive $50 million for the construction and operation of its waste-to-biofuels facility to be located in Pontotoc, Mississippi.

The Carlyle Group and Chinese conglomerate Fosun Group plan to launch a yuan-denominated private equity fund. Each group has committed an initial $50 million, with plans to raise additional outside capital.

Evercore Partners (NYSE: EVR) has acquired Neuberger Berman’s private funds placement group, which is headquartered in London. No financial terms were disclosed, except that the transaction includes possible earnout payments.

VC Deals

Ngmoco, a developer of “socially empowering games” for the iPhone, has raised $25 million in Series C funding. Institutional Venture Partners led the round, and was joined by return backers Kleiner Perkins Caufield & Byers, Norwest Venture Partners and Maples Investments. Ngmoco previously raised $15.6 million.

Pano Logic, a Menlo Park, Calif.-based developer of zero-client desktop virtualization, has raised $20 million in Series C funding. Mayfield Fund led the round, and was joined by return backers Goldman Sachs and Foundation ! Capital.

Luminus Devices Inc., a Billerica, Mass.-based maker of LED products for both display and illumination applications, has $19 million in sixth-round funding. Return backers include Argonaut Private Equity, Braemar Energy Ventures, Paladin Capital Group and Stata Venture Partners. The company raised a $72 million Series E round in early 2008.

General Compression Inc., a Newton, Mass.-based developer of compressed air energy storage systems, has raised over $17 million in Series A funding. US Renewables Group led the round, and was joined by Duke Energy.

Quantenna Communications Corp., a Fremont, Calif.- based fabless maker of wireless chipsets, has raised $15 million in Series D funding. Return backers include Grazia Equity, Sequoia Capital, Sigma Partners, Southern Cross, Swisscom and Venrock. The company has now raised more than $57 million in total VC funding.

CFX Battery Inc., a Pasadena, Calif.-based developer of primary and rechargeable batteries enabled by nanotechnology, has raised $14.2 million in Series B funding. Return backers include CMEA Capital, Harris & Harris, Schlumberger and US Venture Partners. The company has now raised $29.4 million in total VC funding.

Currensee, a Boston-based operator of a community site for Forex traders to track their relative performance, has raised $8 mill! ion in Series B funding. Return backers North Bridge Venture Partners led the round, and was joined by new investorEgan-Managed Capital. The company previously raised around $6 million., an online community for employers to recruit young professionals, has raised $1.5 million in new angel funding. The company has offices in San Francisco and New Orleans.

Buyouts Deals

Apollo Management, Bain Capital and TPG Capital are among those who submitted second round bids for Dow Chemical’s Styron unit, which is expected to garner more than $1 billion.

HSBC plans to sell its UK rolling stock leasing company for up to £2 billion. Star Capital reportedly has interest, while the infrastructure funds of Macquarie and JPMorgan have teamed up for a bid.

PE-Backed IPOs

AVEO Pharmaceuticals Inc., a Cambridge, Mass.-based oncology drug company, has set its IPO terms to seven million common shares being offered at between $13 and $15 per share. It would have an initial market cap of approximately $415 million, were it to price at the high end of its range. The company plans to trade on the Nasdaq under ticker symbol AVEO, with J.P. Morgan and Morgan Stanley serving as co-lead underwriters. AVEO has raised around $151 million in VC funding, from firms like Biogen Idec (14% pre-IPO stake), MPM Capital (10.7%), Highland Capital Partners (9.9%), Venrock (8%), Prospect Venture Partners (7.8%), Bessemer Venture Partners, Merlin BioMed Group, Mitsubishi UFJ Financial Group, Flagship Ventures, Oxford Bioscience Partners, Greylock Partners, Lotus Biosciences, GE Capital and Vatera Holdings.

PE-Backed M&A

Alibris Inc., an Emeryville, Calif.-based online marketplace for new and used books, has acquired Monsoon, a Portland, Ore.-based marketplace selling solutions company, for an undisclosed amount of cash and stock. Oak Hill Capital, which acquired Alibris in 2006, and Square 1 Bank helped finance the transaction.

Active Interest Media Inc., a portfolio company of Wind Point Partners, has acquired all equine titles and online properties published by Source Interlink Media and by Horse Media Group. No financial terms were disclosed.

PE Exits

Motorola (NYSE: MOT) has acquired BitBand Inc., an Tel Aviv, Israel-based provider video-on-demand technology for IPTV. No financial terms were disclosed. BitBand had raised over $9 million in VC funding from Apax Partners, Sequoia Capital, Aviv Venture Capital, the Challenge Fund and Ascend Technology Ventures.

Firms & Fund

Citigroup is in talks to sell its $4 billion hedge fund business to SkyBridge Capital, according to The Wall Street Journal.

Human Resource

André Jaeggi has joined VC exchange fund operator The Founders Club as chairman. He previously was a managing director with Adveq.

Matt Coffin has joined Split Rock Partners as a venture advisor. He had been founder and CEO of former Split Rock portfolio company LowerMyBills, which was acquired by Experian in 2005 for $380 million.

Johnny Randel has joined private equity advisory StepStone Group as chief financial officer and chief operating officer. He previously was with Citi Private Equity, and will work out of StepStone’s ! new office in New York City.