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    PE Week Wire -- Thursday, January 19

Random Ramblings: Ohio, Amp’d and More…

It is unprecedented for a limited partner to sue most of its general partners at the same time, but that’s the level of rarified absurdity to which the Ohio disclosure dispute has sunk.

As expected, Ohio Attorney General Jim Petro last Friday filed a complaint for declaratory judgment in a Franklin County courthouse, with the Ohio Bureau of Workers’ Compensation listed as plaintiff and 43 of its private equity general partners listed as defendants. Now part of this is just legal formality, but Petro and OBWC could have easily avoided this awkward plaintiff/defendant dichotomy. How? By simply asserting that portfolio company information is considered trade secret, and then defending that right in any subsequent lawsuits filed by open records requestors like The Columbus Dispatch and Associated Press file their own lawsuits (which is what happened in California, for example).

But Petro and OBWC instead are going on the offensive, despite an earlier OBWC pledge that the system would take neither a pro-disclosure nor anti-disclosure position in court. The complaint specifically requests that the judge declare that none of the portfolio company information be regarded as trade secret, and that “all of the information from the Defendants that the BWC holds in the Ennis Knupp report is subject to public inspection under the Ohio Public Records Act.”

The complaint also includes an interesting excerpt from a 1960 decision in Patterson v. Ayers:

The rule in Ohio is that public records are the people’s records, and that the officials in whose custody they happen to be are merely trustees for the people; therefore anyone may inspect such records at any time, subject only to the limitation that such inspection does not endanger the safety of the record, or unreasonably interfere with the discharge of the duties of the officer having custody of the same.

It is last part of that statement which a judge will have to decide, if he or she does not feel that the trade secret burden is adequately met. It is undeniable that the release of portfolio company information will end any chance OBWC has of getting into new private equity funds, which therefore could be interpreted as interfering with the discharge of duties. On the other hand, OBWC has no immediate plans to remain active in the private equity asset class, so perhaps there is no one left to perform such duties (depending on how you view the duty of fiduciary responsibility vis-ŕ-vis portfolio management).

No word yet on how long the court will take to make its decision, although an attorney did tell me: “I think it could be while before anything definitive comes out--a declaratory judgment action is still litigation and that is usually fairlyprolonged.”

*** I’ve obviously been quite taken with Amp’d Mobile, but even I was skeptical when CEO Peter Adderton told folks that the company was planning to secure $100 million in new VC funding just 45 days after adding $50 million from MTV Networks. After all, Amp’d had raised $117 million since August and that’s a lot of moolah – even for a company ramping out a national communications platform. But I’ve been informed that not only has Amp’d grabbed the $100 million, but the deal was oversubscribed and the company opened its pockets a bit wider. A formal announcement is expected next week, so long as a few final details get ironed out. Expect all existing backers to participate – MTV, Universal Music Group, Highland Capital, Columbia Capital, Redpoint Ventures – plus some new private equity names.

*** We're up to 25 firms participating in our 3rd Annual Internship Drive. Keep 'em coming.

*** Matt Sheahan will be pinch-hitting for me tomorrow, as I’ll be at the Wharton Private Equity Conference in Philly. Hope to see you there.

    Top Three

Health Dialog Services Corp., a Boston-based provider of care management services like disease management, has raised $170 million via a strategic partial recapitalization. New investors include Oak Investment Partners and American Re (member of the MunichRe Group), plus return backers British United Provident Association (BUPA), HarbourVest Partners, Arcadia Partners and Spencer Trask.

Omrix Biopharmaceuticals Inc., a New York-based developer of therapies in the plasma and biotech fields, has filed to raise $80.5 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol OMRI, with UBS serving as lead underwriter. Shareholders include MPM Capital (29.5% pre-IPO stake) and AlpInvest (8%).

Jabil Circuit Inc. (NYSE:JBL) has exercised its purchase option to acquire all of the outstanding stock of Celetronix International Ltd., an India-based manufacturer of electronic products. Jabil had loaned $25 million to Celetronix last year in exchange for an option to buy the entire company, with the incremental purchase price for the acquisition is expected to be approximately $155 million plus the assumption of approximately $30 million of net debt. Celetronix has raised around 4136 million in total VC funding since its 2000 inception, from firms like Alta Partners, Baring Private Equity Partners, Flextronics, Golden Gate Capital, New Enterprise Associates and WestBridge Capital Partners.

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    VC Deals

IPWireless Inc., a San Bruno, Calif.-based provider of mobile broadband and multimedia technology, has raised $10 million in new strategic funding from Sprint Nextel. This follows up on a $4 million financing from sprint Nextel in July 2005. IPWireless now has raised around $155 million in total VC funding since its 1999 inception, with other shareholders including Bay Partners, DCM - Doll Capital Management, Gabriel Venture Partners, GIC Special Investments, J.F. Shea Venture Capital, Northwood Ventures and Oak Hill Capital Management.

Fallbrook Technologies Inc., a San Diego-based developer of performance and flexibility solutions of vehicle and equipment transmissions, has called down $9.3 million of an $11 million Series C round at a post-money valuation of $120 million. No investor identities were disclosed.

Trulia Inc., a San Francisco-based provider of online real estate services, has raised $5.7 million in Series A funding led by Accel Partners, according to a regulatory filing.

AdSpace Networks Inc. (f.k.a. CoolSign Media), a New York-based provider of multimedia advertising services for malls, has called down $18 million of a $20 million Series D round, according to a regulatory filing and VentureWire report. Valence Capital Management led the deal, and was joined by AIG Global Sports & Entertainment Fund, DCM-Doll Capital Management, GIC Special Investments and Basil Investment Pte Ltd.

Chlorogen Inc., a St. Louis-based developer of a protein-based therapy for gynecological cancer, has raised $6 million in Series B funding. Finistere Partners was joined on the deal by return backers Burrill & Co., Harris & Harris Group, Prolog Ventures and Redmont Venture Partners.

Invarium Inc., a San Jose, Calif.-based provider of layout printability solutions for semiconductor manufacturers, has secured $6 million of a $9 million Series B round, according to a regulatory filing. Backers include Onset Ventures and Goldman Sachs.

Izze Beverage Inc., a Boulder, Colo.-based provider of sparkling juices, has raised $5.15 million in Series D funding, according to a regulatory filing. Backers include Sherbrooke Capital and Tango.

Intrepid Learning Solutions Inc., a Seattle-based provider of managed training solutions, has secured $6.08 million of a $7.48 million Series C round, according to a regulatory filing. Backers include Rustic Canyon Partners and Madrona Venture Group.

Intelliburn Energy Systems Inc. of Omaha, Neb. has raised $1 million in Series A funding from TTI Technologies Inc., according to a regulatory filing.

CODA Genomics Inc., an Irvine, Calif.-based developer of synthetic gene kits for protein expression, has secured around $644,000 of a $750,000 Series A round, according to a regulatory filing. Backers include Life Science Angel Investors and Seraphim Fund.

Franklin Fuel Cells Inc., a Malvern, Pa.-based developer of solid-oxide fuel cell technology, has secured $2.32 million of a $10 million Series AA round, according to a regulatory filing. EnerTech Capital Partners is the company’s primary outside backer.

CircumNav Networks Inc., a Palo Alto, Calif.-based developer of traffic information solutions, has raised around $15.5 million in Series A-1 funding, according to a regulatory filing. Skymoon Research & Development is listed as a shareholder.

Consorte Media Inc., a San Francisco-based direct marketing services company specializing in Spanish-speaking customer lead generation, has secured $400,000 of a $551,000 Series A round, according to a regulatory filing. Backers include Band of Angels and Woodside Group.

    Buyout Deals

Bain Capital has agreed to acquire apparel retailer Burlington Coat Factory Warehouse Corp. (NYSE: BCF) for $45.50 per share. The total transaction is valued at approximately $2.06 billion.

Albertson’s Inc. (NYSE: ABS) still may end up in private equity hands, according to The Wall Street Journal. The supermarket chain reportedly has received a $9.6 billion bid from fellow supermarket operator Supervalu Inc. and a consortium of undisclosed private equity firms (which may, or may not, include initial bidders like Cerberus).

Kirtland Capital Partners has acquired Crysteel Manufacturing Inc., a Lake Crystal, Minn.-based manufacturer of light and medium dump and platform bodies and hoists. No financial terms were disclosed. Kirtland will use Crysteel as an add-on acquisition to Truck Bodies & Equipment International Inc., a platform company created by Kirtland in 2005 through the simultaneous acquisitions of Ox Bodies and Rugby Manufacturing.

Henan Shineway, a state-owned Chinese meat producer, has put itself of the auction block for approximately $800 million, according to The Financial Times. The report suggests interest from firms like JPMorgan Partners, AIG and Temasek Holdings.

    PE-Backed IPOs

Koppers Holdings Inc., a Pittsburgh-based provider of carbon compounds and commercial wood treatment products, has increased the numbers of common shares it is offering in its IPO, from 8.7 million to 10 million. The proposed price range remains at between $14 and $16 per share. It plans to trade on the Nasdaq under ticker symbol KOP, with CSFB and UBS serving as lead underwriters. Koppers is controlled by Saratoga Partners.

Healspring Inc. (f.k.a. NewQuest Holdings), a Nashville, Tenn.-based managed care organization, has set its proposed IPO terms to 17 million common shares being offered at between $16 and $18 per share. It plans to trade on theNYSE under ticker symbol HS, with Goldman Sachs, Citigroup and UBS serving as lead underwriters. The company is controlled by GTCR Golder-Rauner, which sponsored a $354.7 million recap of the company earlier this year ($139.7 million in equity).

Debenhams Retail PLC, a UK-based department store chain, reportedly is considering a Gbp3 billion flotation. The company was bought in 2003 by a private equity group that included CVC Capital Partners, Texas Pacific Group and Merrill Lynch Global Private Equity.

    PE-Related M&A

LANDesk Software Inc., a New Jordan, Utah-based provider of integrated systems and security management solutions, has acquired substantially all of the assets of NewRoad Software Inc., a Jacksonville, Fla.-based provider of business process management and workflow automation solutions. No financial terms were disclosed. LANDesk Software has received VC funding from firms like Blueprint Ventures and WestBridge Ventures.

    Firm & Fund News

Bridge Investment Fund has held a first closing for its inaugural fund, which is targeted at $15 million. The firm has offices in both Cleveland and Tel Aviv, and is interested in Israeli bioscience companies that will establish U.S. operations in the Great Lakes Region.

Silicon Valley Bank plans to open a support and back-operations facility in Salt Lake City in the first half of 2006.

    Human Resources

Stefano Robertson has joined Golub Capital as a senior vice president in the firm’s Chicago office. He has spent the past eight years with Antares Capital, most recently as a senior vice president.

Barry Neal has joined Wells Fargo & Co. as the company’s first head of environmental finance. He has been an energy industry consultant for the past three years, and before that helped El Paso Energy form a private equity fund. He also was a senior member of Energy Investors Funds Group.

Keir Barrie reportedly has joined the private equity practice of UK law firm Osborne Clarke. Barrie is a former in-house counsel with OC client 3i Group, and most recently was a partner with Addleshaw Goddard. Osborne Clark also has hired private equity associate Justine Jones away from Lovells.

Matt Mitchell has agreed to join boutique placement agent Champlain Advisors as a vice president. He previously worked in Lehman Brothers’ private funds group.

Financo Inc. has promoted William Busko to managing director of mergers and acquisitions. It also has hired former Dresdner Kleinwort Wasserstein pro Reyaz Kassamali as a director.

JumpStart Inc., a Cleveland-based nonprofit venture development organization, has hired Roy Phelan as an executive-in-residence and Kerri Breen as an investment associate. Phelan most recently was CEO of software startup PinPoint1, while Breen was a vice president in the syndicated finance group at KeyBank.

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January 19, 2006

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