Greetings from Chicago, where tonight we’ll be hosting our sold-out peHUB Shindig at English. I spent most of yesterday in delay-laden transit, so just a few notes to kick us off:
*** Legislative Update: What emerged yesterday from conference was that private equity firms with over $150m in assets under management would, indeed, be required to register with the SEC (beginning in June 2011). There also would be some additional reporting requirements, although not as many as some had proposed.
Venture capital firms, on the other hand, will be exempted (regardless of size). I’m still trying to figure out details of the PE/VC distinction, or if it simply will be kicked over to the SEC.
*** Mike Bloomberg yesterday addressed the controversy surrounding Steven Rattner, who recently launched a new asset management firm to handle the Mayor’s money (! basically the same team that managed it for Rattner’s old firm, Quadrangle Group).
More specifically, he defended his “close friend” to the Washington Examiner, saying: “I don’t think he did anything wrong… I happen to think the charge against him is ridiculous.” Then he added this bon mot: “I’ve always stood up for anybody that works with me who gets attacked by the press.”
Two thoughts for you, Mr. Mayor: First, it isn’t just the press that’s attacking your pal, unless his former partners at Quadrangle and Andrew Cuomo recently switched careers. Second, it wasn’t the press that allegedly persuaded a Quadrangle portfolio company (since defunct) to sign a DVD distribution deal for “Chooch,” over the initial objections of portfolio company management….
*** Mea Culpa: Back in April, I told you that Polaris Venture Partners was steaming toward a final close on $500 million for its sixth fund. That’s a big cut from t! he $1 billion vehicle it’s currently investing out of, but the process seemed smoother than that of local rival Highland Capital Partners (which also halved the target of its new fund, but took a while to get there).
Well, it seems Polaris is having troubles too (which means I was wrong). A regulatory filing indicates that the $500 million target is now a $400 million target, and that the firm had only hard circled $233 million as of May 26. An LP source says that the revised timeline is to hit a final close sometime in Q3, but that Q4 remained a possibility.
It’s also worth noting that the regulatory filing reflects some succession planning inside of Polaris. The firm’s prior fund listed three primary partners on SEC docs: Jon Flint, Terry McGuire and Alan Spoon. The new filing lists six primary partners, but Spoon isn’t one of them. I’m told that the actual PPM does indeed list Spoon as a GP, but that the move is to better enable the firm’s future viability after he eventually retires.
*! ** Charles Froeb is leaving Credit Suisse, where he has spent the past decade as a West Coast managing director in the firm’s fund placement group. It’s a fairly big departure, given that he’s helped work on funds for firms like Blackstone, Oak Hill, Leonard Green, CD&R, Coller Capital and New Mountain Capital.
Expect the transition to last around a month, after which he’s expected to turn up as an in-house fundraiser at a PE firm. I’d tell you which one, except I don’t yet know it (and Froeb declined to comment).
Lindsay Goldberg has agreed to sell U.S. food distributor Keystone Foods to Brazilian processed foods company Marfrig Alimentos SA. The deal is valued at $1.26 billion.
FoldRx Pharmaceuticals Inc., a Cambrbidge, Mass.-based developer of drugs to treat diseases of protein misfolding and aggregation, has raised $29 million in third-round funding. Novo Ventures and Morgenthaler Ventures were joined by return backers Healthcare Ventures, Fidelity Biosciences, TPG Biotechnology, Alta Partners and Novartis Venture Funds.
Arthur Higgins, former chairman of Bayer HealthCare AG, has joined The Blackstone Group to focus on healthcare transactions.
VC Deals
Predictive Biosciences, a Lexington, Mass.-based developer of intervention diagnostic assays for cancer management, has raised $25 million in Series C funding. ProQuest Investments led the round, and was joined by return backers Flybridge Capital Partners, Highland Capital Partners, Kaiser Permanente Ventures and New Enterprise Associates. The company previously raised $32 million.
Machinima.com, an online entertainment network for video gamers, has raised $9 million in Series B funding from Redpoint Ventures. The company previously raised a $3.85 milli! on Series A round from MK Capital.
Bill.com Inc., a Palo Alto, Calif.-based provider of online bill management and payment for accounting firms and SMEs, has raised $8.5 million in Series C funding. Jafco Ventures led the round, and was joined by return backers DCM, Emergence Capital and August Capita. The company previously raised over $17 million.
AlienVault, a Campbell, Calif.-based provider of security information and event management solutions, has raised $4 million in Series A funding. Adara Venture Partners led the round, and was joined by Teldat Group and Neotec.
Gogobot, a stealthy onlin! e travel startup, has raised $4 million from Battery Ventures, accordi ng to TechCrunch. The company’s co-founders are Travis Katz (ex-MySpace) and Ori Zaltzman (ex-Yahoo). www.gogobot.com
Intamac Systems Ltd., a UK-based provider of Internet-accessed monitoring and control services, has raised £4 million from Carbon Trust Investments, Chandos Capital Ventures and Seraphim Capital.
Magnetic, a New York-based search data marketplace, has raised $4 million in Series A funding. Charles River Ventures, Ron Conway and NYC Investment Fund were joined by seed backers Founder Collective and IA Capital Partners.
Buyouts Deals
Madison Dearborn Capital Partners has completed its acquisition of a 51% equity stake in consumer credit reporting company TransUnion from the Pritzker family, which will retain the other 49 percent. No financial terms were disclosed, although the Wall Street Journal previously reported that the deal values TransUnion at around $2 billion.
Navis Capital Partners has offered to acquire Eng Kong Holdings Ltd., a Singapore-listed provider of container services. The offer would value Eng Kong at around S$77.44 million (US$55.46m). www.naviscapital.net
Providence Equity Partners has completed its ! acquisition of a 25% equity stake in online automotive shopping site AutoTrader.com, a subsidiary of Cox Enterprises Inc. No financial terms were disclosed. Cox was advised on the sale by Goldman Sachs.
Wind Hellas, a Greek mobile operator owned by Weather Investments, is in talks with creditors about a debt restructuring.
PE-Backed IPOs
BroadSoft Inc., a Gaithersburg, Md.-based provider of VoIP application software to the telecom industry, raised around $67.5 million in its IPO. The company priced 7.5 millon shares at $9 per share ($9-$11 offering range), for an initial market cap of around $221 million.Broadsoft has raised around $76 million in total VC funding since 1998, from firms like Bessemer Venture Partners, Grotech Ventures, Charles River Ventures, Columbia Capital, RRE Ventures, Crescendo Ventures and Meritech Capital Partners.
Jupiter Asset Management has raised £220 million via an IPO in London, pricing at 165 pence per share (150-210 pence per share offering range). Private equity backer TA Associates will hold a 22% stake, post-offering.
MagnaChip Semiconductor LLC, a South Korean maker of analog and mixed-signal semiconductor products for high-volume consumer applications, has set its IPO terms to 7.5 million shares being offered at between $15.50 and $17.50 per share. It would have an initial market cap of approximately $698 million, were it to price at the high end of its range. Avenue Capital Group currently holds a 70.3% ownership stake.
PE-Backed M&A
Violin Memory, a Mountain View, Calif.-based developer of Flash memory enterprise systems, has acquired the technology assets of Gear6, a developer of storage caching solutions. No financial terms were disclosed. Violin Memory has raised over $16 million from Toshiba Corp., while Gear6 raised more than $24 million from Horizon Ventures, U.S. Venture Partners and InterWest Partners.
Firms & Funds
Panoramic Growth Equity, a later-stage UK venture capital firm, has held a £34 million first close on its debut fund.
Human Resources
Cheryl Carner has joined GE Capital Franchise Finance as a senior vice president in the private equity practice. She previously was a managing director with CapitalSource.
Colette Rabbat Taylor has joined Grail Partners, a merchant bank focused on financial tech and financial services, as a partner. She previously was with Proctor NBF Capital Partners, a private equity affiliate of Putnam Lovell NBF.
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