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    PE Week Wire -- Tuesday, February 7



Random Ramblings

A few quick notes as a plethora of VC funding news has sapped the morning of time…

*** AIG and Cartesian Group (i.e., Peter Yu et all) are currently appearing in a Manhattan courtroom, arguing for an against AIG’s request for a temporary injunction that would suspend Cartesian’s fund-raising activities. Cartesian also has filed a lengthy response to AIG’s initial complaint, which includes strenuous denials of both the computer fraud and breach of contract charges. Once – or if – the judge issues a ruling, I’ll post it on www.PrivateEquityWeek.com. And, of course, we’ll discuss here tomorrow.

*** A bunch of you wrote in to ask what I meant by the following line: “The Washington State Investment Board is playing tough with KKR.” Simple answer: KKR wanted a WSIB to pony up a $3 billion commitment for the new KKR mega-fund, but WSIB only will provide $1.5 billion. OK, “tough” may be an overstatement given that $1.5 billion is still a massive number, but WSIB isn’t known for saying no to KKR.

*** Kim Davis King has decided to leave IDG Ventures Pacific, in a move that can be best described as surprising. King was supposed to be one of four general partners on a new fund for the group that would include both IDG capital and third-party commitments. In fact, she was cited as such in a December press release announcing the return of group founder Pat Kenealy to the partnership. King only will say that she plans to stay in VC in Southern California and work for a traditional venture fund. Kenealy also was relatively quiet, saying that IDG Ventures Pacific still “is likely to go ahead and raise a fund.”

*** Joe Lacob of Kleiner Perkins has bought into the Boston Celtics partnership. Apparently KPCB is now doing turnarounds.

*** While we keep waiting for the $100 million-plus funding news from Amp’d Mobile, a couple of other MVNO space notes. First, MobileCrunch reports that Kajeet has raised $27 million in Series A funding led by Bessemer Venture Partners. Other participants include Fidelity Ventures, Gabriel Venture Partners and InterWest Partners. Both Kajeet and Amp’d focus on the youth market, but Kajeet is looking more at tweens while Amp’d is looking more at teens. In other MVNO news, my fellow Super Bowl watchers couldn’t quite figure out why anyone would want ESPN Mobile. Teens like to listen to music or watch video clips on the go, but sporting events are just that: events. People want to sit around a big TV and watch. Sure it’s great to get scores and highlights, but scores can be gotten on almost any mobile device. So would you really buy a phone to get a quick clip of Kobe dunking? No, me either.

*** Finally, the PE Week Wire now has over 29,500 subscribers. In related news, I turn 30 years old on Feb. 22. Do you see where I’m going with this? That’s right, it’s the 30-by-30 drive. Can’t you just feel the excitement…

 
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    Top Three



Citadel Broadcasting Corp. (NYSE: CDL) has agreed to acquire ABC Radio from The Walt Disney Co. (NYSE: DIS) for approximately $2.7 billion. Forstmann Little & Co. holds 67% of Citadel’s shares, and voted in favor of the transaction.

Sorbent Therapeutics Inc., a Vernon Hills, Ill.-based company focused on end-stage renal disease patients undergoing dialysis, has raised $19.2 million in Series A funding, according to a regulatory filing. Backers include CMEA Ventures, Sofinnova Ventures, Arch Venture Partners and Dow Global Technologies Inc.

J.H. Whitney & Co. has closed its sixth fund with $775 million in capital commitments, according to a regulatory filing. www.whitney.com

 
Buyouts Symposium East
March 8-9 in New York at the Pierre Hotel

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networking event, Buyouts Symposium East , which takes place
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at the Pierre Hotel. Planned by the staff of
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, the conference offers an insightful agenda, high-level
speakers and attendees, and plenty of time to network. The list below shows
firms who have already registered. You can register or obtain more
information by visiting www.buyouts-symposium.com.
 

    VC Deals

4Info Inc., a Palo Alto, Calif.-based provider of mobile search services, has raised $9.5 million in Series C funding, according to a regulatory filing. Return backers include Draper Fisher Jurvetson and US Venture Partners. The company had raised an $8 million Series B round last May. www.4info.net

BDNA Corp., a Mountain View, Calif.-based provider of business asset management solutions for IT and finance, has raised $3 million in additional Series C funding, according to a regulatory filing. The round total now stands at $15.5 million. Backers include Crescendo Ventures, Newbury Ventures and Motorola Ventures. www.bdnacorp.com

BeamExpress Inc., a Sunnyvale, Calif.-based developer of fiber-optic component solutions, has raised around $16.66 million in Series A-1 funding, according to a regulatory filing. Backers include Index Ventures and Oak Investment Partners. www.beamexpress.com

Podcast Ready Inc., a Houston, Texas-based podcasting startup, has raised $525,000 in Series A funding led by DFJ Mercury Partners, according to a regulatory filing. www.podcastready.com

Tizor Systems Inc., a Maynard, Mass.-based provider of activity auditing solutions for compliance and data theft protection in the data center, has raised around $3 million in additional Series B funding from Longworth Venture Partners. This brings the round total to $15 million. Existing round participants included Masthead Ventures, Navigator Technology Ventures and Common Angels. www.tizor.com

MacroGenics Inc., a Rockville, Md.-based drug and vaccine company, is in the midst of raising $40 million in third-round funding, according to the Washington Business Journal. It previously raised a $30.5 million Series B round in 2004 from firms like Alta Partners and Red Abbey Venture Partners. www.macrogenics.com

Network Vision Software Inc., a Newburyport, Mass.-based developer of network and device visualization tools for the automation industry, has raised around $1.85 million in Series A funding led by Axia Capital Partners, according to a regulatory filing.

ACS Ltd., a Toronto-based provider of design and testing services for exhaust/emission systems and tubular product OEMs, has received an undisclosed amount of private equity and mezzanine funding from VenGrowth. www.acslimited.ca

SNAPin Software Inc., a Bellevue, Wash.–based provider of self-service software for mobile phones, has raised $13 million in Series C funding. Oak Investment Partners led the deal, and was joined by fellow insiders Frazier Technology Ventures and Hunt Ventures. www.snapin.com

TagWorld, a Santa Monica, Calif.–based online social networking company, has received an undisclosed amount of funding from Draper Fisher Jurvetson. As part of the deal, Tim Draper has joined the TagWorld board of directors. www.tagworld.com

IGA Worldwide Inc., a New York-based provider of in-game advertising solutions, has held a $12 million first close on Series A funding round. Easton Capital Group and Morgenthaler Ventures co-led the deal, and were joined by seed backer DN Capital. www.igaworldwide.com

Mazu Networks Inc., a Cambridge, Mass.-based provider of behavior-based network security solutions, has raised $7 million in Series D funding. Return backers include Symantec, Greylock Partners, Matrix Partners, Pilot House Ventures and StarVest Partners. Mazu has raised around $42 million in total VC funding since its 2000 inception. www.mazunetworks.com

Kasenna Inc., a Mountain View, Calif.-based provider of video-on-demand solutions, has raised $11 million in Series E funding at a post-money valuation of approximately $56 million. Intel Capital led the deal, and was joined by return backers like Alloy Ventures, U.S. Venture Partners, Cypress Ventures and Silicon Graphics. www.kasenna.com

Recordant Inc., an Alpharetta, Ga.-based provider of online customer interaction solutions, has secured $1.43 million of a $3.3 million Series A round, according to a regulatory filing. Kodiak Venture Partners is leading the deal. www.recordant.com

Penguin Computing Inc., a San Francisco-based provider of turnkey clusters and servers, has raised $1.72 million in Series AA funding, according to a regulatory filing. Backers include Weber Capital, San Francisco Equity Partners and Convergence Ventures. www.penguincomputing.com

Everest Software Inc., a Sterling, Va.-based developer of business management software, has raised $8 million in Series D funding, according to a regulatory filing. Backers include Updata Venture Partners, Sierra Ventures and Boulder Ventures. www.everestsoftwareinc.com

OrSense Ltd., an Israel-based developer of non-invasive blood glucose monitoring products, has raised $6 million in new VC funding. Israel Healthcare Ventures led the deal, and was joined by STAR Ventures and Lewis Trust Group. www.orsense.com.

Power Analog Microelectronics, a Santa Clara, Calif.-based developer of digital audio amplifiers and power management semiconductors, has raised $6 million in Series A funding. CVM Capital led the deal, and was joined by VentureTech Alliance, H&Q Asia-Pacific and Huanan Venture Capital. www.poweranalog.com

Silecs Inc., a Mountain View, Calif.–based maker of dielectric materials for the semiconductor and flat panel display industries, has raised $7.7 million in new VC funding. www.silecs.com

Eastbeam Group of Berlin and Tokyo has received €3 million in venture funding from Wellington Partners. Eastbeam operates Wazap, a subject-specific search engine for information on online, consol and PC games. http://wazap.jp

Actionality, a provider of in-game advertising and marketing solutions for the mobile market, has raised an undisclosed amount of seed funding from Doughty Hanson Technology Ventures. Actionality has offices in Munich, Berlin and Hong Kong. www.actionality.com

    Buyout Deals

MidOcean Partners has agreed to sell its majority stake in West Caldwell, N.J.-based nutritional products company Vitaquest International to an affiliate of Hong Kong biotech company CK Life Sciences International Inc. The deal is valued at $345 million. MidOcean led a recapitalization of Vitaquest in March 2005. www.midoceanpartners.com www.vitaquest.com

Pfingsten Partners has acquired TSE Sports & Entertainment, a New York-based sports and marketing company for Fortune 1000 clients. No financial terms were disclosed. Former TSE owners Robert Tuchman and Brett Sklar will retain equity stakes and their respective positions as president and vice president. They will report to new TSE CEO Chris Brennan, who founded One on One Sports in 1991, and later served as a director with subsequent One on One owner Vulcan Sports Media. www.tseworld.com

Custom House, a Canada–based independent foreign exchange company, has received a “substantial” private equity inv*stment from Great Hill Partners. www.customhouse.com

    PE-Backed IPOs
 
Goodman Global Inc., a Houston, Texas-based manufacturer of heating, ventilation and air conditioning products for residential and light commercial use, has filed to raise $460 million via an IPO of common stock. It plans to trade on the NYSE under ticker symbol GGL, with JPMorgan serving as lead underwriter. Apollo Management has been Goodman’s majority shareholder since a December 2004 buyout. www.goodmanmfg.com

Alphatec Holdings Inc., a Carlsbad, Calif.-based medical device company focused on surgical treatments for spine disorders, has filed to raise $149.5 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol ATEC, with First Albany Capital serving as lead underwriter. HealthPointCapital Partners led a buyout of Alphatec in March 2005. www.alphatecspine.com

    PE-Related M&A

Ubiquity Brands, a Chicago-based snack foods company, has acquired the private-label salty snack business of Wyandot Inc. for an undisclosed amount. The deal includes manufacturing and warehouse facilities in Jeffersonville, Indiana. Ubiquity Brands is a portfolio company of Willis Stein & Partners.

Agentis Software, an Atlanta-based provider business process management applications, has completed a management buyout sponsored by Modena Technologies Capital Partners. Agentis had raised around $25 million in VC funding from such firms as Partech International, Draper Fisher Jurvetson and Constellation Ventures. No financial terms were disclosed. www.agentissoftware.com

EnergySolutions, a Salt Lake City–based national energy services company, has agreed to acquire Duratek Inc., a provider of waste characterization and waste minimization solutions. No financial terms were disclosed. EnergySolutions is owned by Lindsay, Goldberg & Bessemer, Peterson Partners and Creamer Investments. www.energysolutions.com

Dynamic Network Factory, a Hayward, Calif.-based RAID storage company, has acquired StoneFly Networks Inc., a San Diego-based storage area networking company. No financial terms were disclosed. StoneFly has raised around $25 million in VC funding since its 2000 inception, from firms like Crescendo Ventures, El Dorado Ventures, Palomar Ventures and Rustic Canyon Partners. www.stonefly.com

RealNetworks Inc. (Nasdaq: REALNET) has agreed to acquire Dutch gaming company Zylom Media Group BV for around $25.2 million. Zylom has raised VC funding from ABN AMRO Capital. www.zylom.com

ONIT Communications Inc. has acquired the corporate VoIP customers of ICG Communications Inc. in California. No financial terms were disclosed. ICG is an Englewood, Colo.-based telecom company owned by M/C Venture Partners and Columbia Capital. www.icgcomm.com

    Firm & Fund News

Babson Capital Management of Springfield, Mass. has closed Tower Square Capital Partners II with $1 billion in capital commitments. The fund will focus on mezzanine and private equity opportunities. www.babsoncapital.com

Starwood Capital Group Global has closed two real estate private equity funds. The first is the $1.475 billion Starwood Global Opportunity Fund VII, which is focused on undervalued real estate and real estate-related assets. The second is the $900 million Starwood Hospitality Fund, which will focus on hotel, resort and related leisure activities and properties.

Cayuga Venture Fund of Ithaca, N.Y. is looking to raise upwards of $50 million for its third fund, according to a regulatory filing. The firm already has secured $15 million in commitments. www.cvf.biz

    Human Resources

Eliot Powell has joined Venture Investment Associates, a Peapack, N.J.-based private equity fund-of-funds manager, as a managing director. He previously was with JPMorgan, where he helped found the private equity fund-of-funds group in 1997. Before that, he was a vice president with AT&T Investment Management.

GSC Partners has promoted ten people to senior managing director. They are: Robert Cummings Jr., Peter Frank, Robert Hamwee, Frederick Horton, Thomas Inglesby, Matthew Kaufman, Libassi, Christine Vanden Beukel, Andrew Wagner and Joseph Wender. The firm also promoted 12 people to managing director: Marc Ciancimino, Peter Firth, Seth Katzenstein, Daniel Lukas, Mayur Patel, Nick Petrusic, Philip Raygorodetsky, David Robbins, Harvey Siegel, Edward Steffelin, Alexander Wright and Wenbo Zhu. www.gscpartners.com

Jaime Johnson has joined Paul Capital Partners as a managing director in the firm’s San Francisco office. Johnson will focus on making commitments to top-performing private equity funds, and previously was head of private equity at London-based family office Alta Advisors. www.paulcapital.com

Capstone Palomar Partners, a private equity placement agent, has promoted both Alex Brooks and Clayton Deniger to partner. Brooks joined as a principal in 2004, while Deniger hoined as a principal in 2005. www.csplp.com

Private Equity Week

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February 7, 2006




























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