Private Equity Week Wire for Monday 5/7

BOSTON — Corechange Inc., a global provider of e-access framework software, today announced that it has raised $25 million in a Series Cequity financing. Founded in 1996, privately held Corechange has raised $65 million to date and plans to use the funds raised in this financing round to expand its business and accelerate its path toprofitability. UBS Capital Americas III, L.P. and affiliates (collectively, “UBS Capital Americas”) led the round with additional investments from Exelon Capital Partners and SG CowenVentures, as well as from strategic investors, including Nortel Networks. Earlier round investors ABN AMRO Private Equity and HarbourVest Venture Partners also participated inthe round. SG Cowen acted as exclusive private placement agent.

LA JOLLA, CA — Early Capital, a La Jolla-based private equity intermediary, today announced that John Dickerson, president of Summit Global Management of La Jolla, has joined the Early Capital Board of Directors.Early Capital offers capital matchmaking services for entrepreneurs and investors. The company accepts and screens opportunities for private equity investments from entrepreneurs, and offers the most select and promising investments to its network of accredited individual investors and institutions.

SUNNYVALE, CA — Savi Technology Inc. today announced that it has received $20 million in a financing round led by k1Ventures Limited, one of the largest venture capital funds in Asia. The third-round financing, which is intended to fund strategic investments and potential acquisitions, reflects the strength of the company’s position as a leading provider of real-time supply chain logistics management systems. Savi Technology provides a software platform and applications to enable multi-national shippers, logistics services providers, conveyance owners, and infrastructure owners to monitor, manage, and optimize the progress of goods through all segments of a global supply chain. A unique component of the company’s strategy is its use of a wireless data network to automatically track the movement of in-transit goods and materials. In addition to k1Ventures, the investment arm of the Singapore Infocomm Development Authority (IDA) also participated as a new investor in the round. Six organizations that had previously invested in Savi Technology also participated: Accel Partners; Mohr, Davidow Ventures; Temasek Holdings; United Parcel Service (NYSE:UPS), through its UPS Strategic Enterprise Fund; Vector Capital; and Venture TDF.

MOUNTAIN VIEW, CA — BlueArc Corp., developer of the world’s highest performance enterprise-class network storage systems, today announced the completion of a $72 million round of financing led by Weston Presidio and previous BlueArc investors Celtic House International, Patricof & Co. Ventures and Apax Partners & Co. Also joining this round of funding are Dell Ventures, EUROQUBE, New York Common Retirement Co-investment Fund advised by Pacific Corporate Group, JPMorgan Partners, and Fort Washington Capital. The investment will be used to drive the growth of BlueArc in the extremely fast moving network storage market. Since the company’s founding in 1998 BlueArc has secured over $100 million in funding. Coinciding with the completion of this round of funding, BlueArc announced today that James B. McElwee, general partner of Weston Presidio, has joined BlueArc’s board of directors.

MENLO PARK, CA — Benchmark Capital, Silicon Valley’s leading early-stage high-tech venture capital firm, today announced that it has closed a $220 million fund dedicated to accessing the Israeli high-technology market. Benchmark Israel has drawn support from institutional investors, leading corporations and influential high-tech executives in the U.S., Israel and Europe. In addition to Benchmark institutional and individual partners, Benchmark Israel attracted investments from companies such as Cisco Systems (Nasdaq: CSCO), Rational Software (Nasdaq: RATL), Mercury Interactive (Nasdaq: MERQ), and Infineon Technologies (NYSE: ISX). Benchmark and its corporate partners will work together to best leverage Israeli high-tech opportunities.

NEW YORK & SAN FRANCISCO ? Behrman Capital, a private investment firm focused on emerging growth companies in the information technology, outsourcing, business services and contract manufacturing sectors, today announced that it has completed its final closing on a new private equity partnership, Behrman Capital III L.P. Behrman Capital III L.P. closed with committed capital of $1.2 billion. Institutional investors accounted for 98% of the capital committed. Public pension funds accounted for 36% (including California Public Employees? Retirement System ($150 million), New York State Common Retirement Fund ($100 million), Kansas Public Employees Retirement System; Los Angeles County Employees Retirement Association; Illinois State Board of Investment and the Ohio Bureau of Workers? Compensation). Investors based outside the United States accounted for 22%; financial institutions 21%, funds of funds 10% and corporate pension funds 9% of committed capital.

LOD, ISRAEL — GalayOr Networks has completed a seed round of $8 million, in the largest seed financing by an Israeli company since the beginning of the current period of uncertainty in thecapital markets. Evergreen Venture Capital Led the Round, alongside STI Ventures and Neurone Ventures. GalayOr Networks develops on-chip integrated Micro Opto-Mechanical Systems (MOMS) based on a technology that was developed by its chief scientist, Dr. Dan Haronian,beginning in 1996, at which time he served as the head of the MEMS (Micro Electro Mechanical Systems) group at Tel Aviv University. Dr. Haronian established GalayOr togetherwith Noel Elman, a MEMS researcher with Cornell University and Dr. Uri Geiger, GalayOr’s CEO, in late 2000.

BELMONT, CA — PowerMarket, Inc., the company setting the standard for the union of business intelligence with supply chainmanagement, today announced it has closed a $12.5 million second round of financing led by Palo Alto-based Norwest Venture Partners (PeopleSoft, Information Advantage, Tivoli).Joining Norwest Venture Partners in this round is RRE Ventures (Frictionless Commerce, Portera Systems) and lead first round investor, Kleiner Perkins Caufield & Byers (Sun,America Online, E.piphany, WebMethods), bringing the total amount of capital raised by PowerMarket to $23 million.
SOUTH SAN FRANCISCOCA — AGY Therapeutics, announced the closing of a $13 million private placement of Series B-2convertible preferred stock. Funds raised in the Series B financing total$24.5 million, bringing the total amount the company has raised to $27.6million. Investors participating in this financing include: Alta Partners,GIMV Venture Capital, Forward Ventures, Jafco Co., Ltd., Lombard Odier, andNovartis Venture Fund.

CAMBRIDGE, MA — Novirio Pharmaceuticals Limited today announced the first closing of a $44 million private equity financing through the issuance of its Series C Preferred Shares. CSFB Private Equity led the round, with additional funding from new and prior investors. Existing investors of Novirio include funds managed by TVM Techno Venture Management, funds managed by MPM Capital, and Nomura International plc. New investors participating in the private placement were Novartis BioVentures Ltd., Hanseatic Americas LDC, Biomedical Sciences Investment Fund PTE Ltd, Swiss Life Private Equity Partners Ltd., Banc of America Securities LLC and Swan Private Equity Verwaltungs GmbH.

PALO ALTO, CA — Responsys Inc., a pioneer inoptimized interactive marketing solutions, today announced that the companyhas received $5 million in funding from RSA Ventures and Foundation Capital, afollow-on to the April 11, 2001 funding of $20 million from Accel Partners,Foundation Capital, Redpoint Ventures and Sigma Partners. In addition, the company today announced the promotion of co-founder RaghuRaghavan to chief technology officer, and the appointment of Virendra R. Vaseto the position of chief information officer and vice president, engineeringand operations.

HOUSTON — Two of the recognized leaders in the drugtesting industry have merged to create one company, Drugtest, Inc. DrugIntervention Services of America, Inc. (DISA, Inc.) and Dipro DiagnosticProducts of North America, Inc. (DIPRO) have come together to create the clearindustry leader in the field of drug testing compliance and employee tracking. The Company will brand as ( using theInternet as one of several delivery mechanisms for its proprietary softwareProgram. is also announcing the completion of $15 million in privateplacement funding. This successful $15 million financing package validates the unmatchedcapabilities of and the opportunity in this industry, despite therecent volatility of the market and the lack of investor funding.

SAN FRANCISCO — Walden International, a leading global venture capital firm, today announced that its portfolio company, Newave Semiconductor Corporation, has been acquired by a leading communications IC provider, Integrated Device Technology, Inc. (Nasdaq:IDTI), for approximately $80 million in cash.

BETHLEHEM, PA — Synchronoss Technologies Inc., a premier business service provider of hosted operations support systems (OSS) environments for major telecom carriers, today announced that they have completed a first round of $34 million in funding from six leading institutional investment firms. Synchronoss’ comprehensive OSS solution enables top tier telecom carriers to streamline service activation and order management, and accelerate delivery of high-speed data services. The funding is led by venture capital firm ABS Ventures, along with Rosewood Venture Group and Ascent Venture Partners. Adams Street Partners, Liberty Ventures, L.L.C. and C.E. Unterberg, Towbin, also participated in the round. The capital is being used to expand key market and product development efforts of Synchronoss’ ActivationNow OSS platform. Synchronoss has already secured customer agreements with AT&T, Qwest, and WorldCom.

MENLO PARK, CA — Foundation Capital, a venture capital firm committed to supporting entrepreneurs and their companies, today announced it has closed a $595 million fund, Foundation Capital Fund IV. Participating in the fund are new limited partners Harvard, Yale and University of Texas, as well as all existing limited partners. Foundation Capital will continue to focus on Internet infrastructure, enterprise applications, telecommunications and networking opportunities. The firm’s mission with Fund IV is to build on the success of existing investments in innovative young companies such as AirFiber and Vivace Networks, as well as established industry leaders, such as Commerce One and Interwoven.
MENLO PARK, CA — U.S. Venture Partners, which today received the initial capital contributions for its eighth fund (USVP VIII), capitalized at $1 billion, announced the addition of three new partners: Geoffry Baehr, Paul Matteucci, and Arati Prabhakar, Ph.D. Geoffrey Baehr is joining USVP as a General Partner after 13 years with Sun Microsystems, where he was Chief Network Officer responsible for technical and strategic networking directions. He previously headed Advanced Development in networking at Sun, and developed advanced technical products and internal lines of business which included ATM interfaces and signaling software, firewalls, network management systems, consumer communication unification devices, high speed networks and protocol infrastructure software. Paul Matteucci, joining USVP as a Venture Partner, is an experienced entrepreneur, executive and investor in technology companies. Currently the Chairman of the Board of HearMe, he also serves as a director of Facetime Communications, HelloBrain and Homestead. Paul joined HearMe in May 1995, serving as Chief Executive Officer for over five years, and taking the company public in April of 1998. Prior to this, Paul worked for Adaptec, Inc. for eight years, where he rose to the position of Vice-President and General Manager of Adaptec’s SCSI host adapter division. Arati Prabhakar, also joining USVP as a Venture Partner, served as a program manager and then Director of the Microelectronics Technology Office at the Defense Advanced Research Projects Agency (DARPA) from 1986 to 1993. Through her DARPA investments, she worked with over 300 companies, universities, and other labs to pursue breakthrough technologies in semiconductor manufacturing, imaging, optoelectronics, and nanoelectronics. In 1993, President Clinton appointed Arati as the Director of the National Institute of Standards and Technology, where she led the 3000-person staff until 1997. At NIST, she co-invested with companies in R&D in areas ranging from healthcare information infrastructure to composite materials to DNA diagnostics. At DARPA and NIST, Arati and her team funded the people and the technologies that went on to build a number of companies with multi-billion-dollar valuations.