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The Year That Was Welcome back dear readers, for another fun-filled year of private equity news, analysis and non-sequiturs (I know dozens of better basketball coaches than Doc Rivers, and some of them coach 8-year-olds). Before charging into 2006, however, let’s look back at 2005 with our first-ever PE Week Wire Awards. The winners were selected after a grueling morning of waking, bathing, driving to Dunkin’ Donuts and compiling market news. They are sponsored by my wife’s cousins – three of whom are soundly asleep in the next room. So without further ado… Biggest Trend Most Consequential Deal Biggest Feud Biggest Fulfilled Hype
Biggest Unfulfilled Hype Largest Pure VC Deal
Pot-Stirrer Award Worst HR Move Worst PR Move Firm Implosion Award Over-Reaching Award
Tallwood Venture Capital hasclosed onapproximately $208 million in capital commitments for its third fund, according to a regulatory filing. Limited partners include CSFB CFIG SPV Investors , Harvard Management Co. and Leland Stanford Junior University Trustees. The filing also indicates that Luis Arzubi, former vice president and general manager of IBM Microelectronics, is now a Tallwood general partner. He previously had served as an advisor to the firm. www.tallwoodvc.com Thomson Financial and the National Venture Capital Association have released year-end M&A and IPO data. Fifty-six VC-backed companies raised $4.5 billion via IPOs on Affiliated Computer Services Inc. (NYSE: ACS) is nearing a deal for be acquired for $65 per share, according to The New York Times . The total deal would be valued at around $8 billion, with the buying consortium to include Texas Pacific Group , Bain Capital and the Blackstone Group . www.acs-inc.com
Perlegen Sciences Inc., a Mountain View, Calif.-based company that studies genetics-related efficacy and adverse effect profiles of pharmaceutical clinical trial participants, has raised $50 million in strategic funding from Pfizer Inc. (NYSE: PFE). The deal gives Pfizer a 12% stake in Perlegen, and also includes Pfizer’s agreement to purchase, at Perlegen’s election, up to an additional $25 million in Perlegen preferred stock. Perlegen has raised around $125 million in total VC funding since being spun out of Affymetrix (Nasdaq: AFFX) in 2000. Backers include CSK Venture Capital, Brookside Capital (a Bain Capital affiliate), Mizuho Securities, Glynn Capital Management, Cape Securities, Maverick Capital, Lombard Odier Darier Hentsch & Cie, Zesiger Capital, Sano Ventures, BSI SA, MPM BioEquities, SB Life Sciences, Unilever Ventures, Biofrontier Partners, Private Life Biomed, CMEA Ventures and Affymetrix Inc. www.perlegen.com Webpay AG, a Switzerland-based provider of payment solutions for European Internet retailers, has raised 20 million euros from 3i Group. www.webpay.ch www.3i.com NewRiver Inc., an Andover, Mass.-based provider of compliance data technology for financial institutions, has raised around $20.58 million in Series B-1 funding, according to a regulatory filing. Backers include Pequot Capital, West Side Investments, Lazard Freres and William Blair New World Ventures. www.newriver.com
Posit Science Corp., a San Francisco-based neurology company, has raised $16.85 million in Series B funding, according to a regulatory filing. An earlier filing – and PE Week Wire item – had put the total at $14.52 million. Backers include Aberdare Ventures, Draper Fisher Jurvetson and VSP Capital. www.positscience.com Browster Inc., a San Francisco-based provider of a downloadable plug-in for the Internet Explorer browser, has raised $3.37 million of a $6.03 million Series A round, according to a regulatory filing. Backers include Vanguard Ventures and Advanced Technology Ventures. Earlier seed backers included John Zeisler of Gabriel Venture Partners, Robert Simon of Alta Partners, former Menlo Ventures pro Rick Magnuson and Ken Sawyer of Saints Ventures. www.browster.com Interactive TKO Inc., a Southlake, Texas-based provider of software testing solutions for composite business applications, has raised around $5.06 million in Series A funding, according to a regulatory filing. Backers include Hunt Ventures and CenterPoint Ventures. www.itko.com Fonality Inc., a Culver City, Calif.-based VoIP company, has raised around $4.11 million in Series B funding, according to a regulatory filing. Backers include Azure Capital Partners. www.fonality.com SpectraGenics Inc., a Pleasanton, Calif.-based medical device company, has raised $6.25 million in Series C funding, according to a regulatory filing. Backers include SDL Ventures, Incubic Ventures and GVC. www.spectragenics.com VM Discovery Inc., a Fremont, Calif.-based developer of drug design and optimization technology, has secured $970,000 of a $2 million Series B round, according to a regulatory filing. Backers include Onset Ventures and Amkey Venture Capital. www.vmdiscovery.com MarketingGenius.com Inc., a San Mateo, Calif.-based developer of marketing software, has raised around $5.2 million in Series A funding, according to a regulatory filing. Backers include Walden International and Emergence Capital Partners. www.marketinggenius.com LearnSomething Inc., a Tallahassee, Fla.-based provider of online interactive distance learning, has raised around $2 million in Series F funding, according to a regulatory filing. Backers include Noro-Moseley Partners. www.learnsomething.com PowerReviews Inc., a Milbrae, Calif.-based enabler of consumer-driven product reviews for online brands and retailers, has raised $6.25 million in Series A funding led by Menlo Ventures, according to a regulatory filing. www.powerreviews.com Olive Software Inc., a Santa Clara, Calif.-based developer of XML automation technologies, has raised $9 million in second-round funding. Pitango Venture Capital led the deal, and was joined by return backer Sequoia Capital. www.olivesoftware.com SkyCross, a Melbourne, Fla.-based provider of wireless antenna solutions, has raised $14 million in new VC funding led by TL Ventures. www.skycross.com Cradle Technologies Inc., a Sunnyvale, Calif.-based provider of multi-core DSP solutions, has raised $18 million in fourth-round funding. Cardinal Venture Capital and return backer Investor Growth Capital co-led the deal, and were joined by Hercules Technology Growth Capital and insiders East Gate Capital Management, NeoCarta Ventures and Smart Technology Ventures. www.cradle.com Continuity Software Inc., a New York-based provider of business continuity software, has raised $1 million in funding from the Office of the Chief Scientist of the Israeli Ministry of Industry and Trade. The funding supplements a recent Series A round led by Giza Venture Capital. www.continuitysoftware.com Catharos Medical Systems Inc. , a Los Gatos, Calif.-based medical device company focused on preventing contrast-induced nephropathy , has raised $1.35 million in Series A funding, according to a regulatory filing. Backers include Finistere Partners .
EQT Partners has agreed to acquire German engine manufacturer MTU Friedrichshafen GmbH from DaimlerChrysler AG for 1.6 billion euros. The deal is expected to close later this quarter. www.eqt.se
Onex Corp. has acquired Skilled Healthcare Group Inc. from Heritage Partners for approximately $745 million (including $260 million in equity from Onex Partners and Skilled Healthcare management). Skilled Healthcare is a Foothill Ranch, Calif.-based operator of long-term healthcare facilities. www.onex.com www.skilledhealthcare.com Odyssey Investment Partners has agreed to acquire York Insurance Services Group Inc. from Bexil Corp. (AMEX: BXL). The deal is valued at approximately $105 million, including the assumption of debt, rollover shares and additional equity contributions from Wellspring Capital Partners has completed its acquisition of a majority stake in Susser Holdings LLC, a Southwestern convenience store operator and fuel distributor. No financial terms were disclosed. www.wellspringcapital.com Circle Peak Capital, Sankaty Investors, Falcon Investment Advisors, The Carlyle Group, Manetar Capital and company management have acquired Shari’s Management Corp. (a.k.a. GE Financial Services and GE Capital Markets have completed the financing and syndication of a $72.8 million senior debt facility for a portfolio of eight power and transmission projects owned by private equity firm ArcLight Capital Partners. www.geenergyfinancialservices.com Kraft Canada Inc. has agreed to sell certain Canadian grocery assets to Sun Capital Partners and EG Capital Group. The combined assets will be renamed CanGro Foods, and will include Aylmer tomatoes, vegetables, fruits, soup and beans; Primo pasta, sauce, soup, tomatoes, beans and other products; Ideal vegetables; Il Migliore and Roma foodservice pasta; and the Canadian licensing rights for a number of Del Monte products. No financial terms were disclosed for the deal, but Kraft estimates that the products will generate approximately Cdn$300 million in net 2005 revenue. www.kraft.com The Riverside Co. has acquired Diatron, a Budapest- and Austria-based manufacturer of hematology analyzers.No financial terms were disclosed. www.riversidecompany.com www.diatron.com Volkswagon AG reportedly has received six bids for its Eurocar rental subsidiary, which could be valued at upwards of $2.9 billion (including debt). The Financial Times identifies the bidders as Sixt, Enterprise Rent-A-Car, Cerberus, Cinven, Carlyle Group and Merrill Lynch. www.vw.com Durr AG has completed the sale of its Measuring and Process Technologies unit to HgCapita l for 205 million euros. www.durr.com Istithmar , an investment arm of the Dubai government, has agreed to buy UK-based marine management company Inchcape Shipping Services from Electra Partners Europe for around Gbp166 million. www.inchcape-shipping.com SOS Cuétara has agreed to acquire Italian olive oil maker Carapelli Firenzi SpA for 160 million euros from BS Private Equity SpA and Arca Impresa Gestioni SGR . www.carapelli.it
CPI Holdco Inc., a Palo Alto, Calif.-based provider of microwave and radio frequency solutions, has filed to raise $125 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol CPII, with UBS and Bear Stearns serving as lead underwriters. The Cypress Group is listed as the company’s owner, following its $318 million buyout of Communication & Power Industries Inc. from Leonard Green & Partners in January 2004. www.cpii.com
Vanda Pharmaceuticals Inc., a Rockville, Md.-based drug company focused on central nervous system disorders, has filed to raise $75 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol VNDA, with JPMorgan and Banc of America Securities serving as lead underwriters. The company has raised around $37 million in VC funding from firms like Care Capital, Domain Associates, MedImmune Ventures, Prospect Venture Partners and Rho Ventures. www.vandapharma.com Alexza Pharmaceuticals Inc., a Palo Alto, Calif.-based drug delivery company, has filed to raise $86.25 million via an IPO of common stock. It plans to trade on the Nasdaq under ticker symbol ALXA, with Piper Jaffray and Pacific Growth Equities serving as lead underwriters. The company has raised around $97 million in VC funding from firms like Frazier Healthcare Ventures, Versant Ventures, Alloy Ventures and Delphi Ventures. www.alexza.com AxisMobile , an Israel-based provider of consumer mobile email technology for communications service providers, is planning to raise $15 million on London 's AIM. The flotation will value AxisMobile at approximately $50 million, with Canaccord Capital serving as lead underwriter. AxisMobile was founded in 2000 at Celltrex Ltd., and in 2002 merged with Valis Ltd. Those two companies raised a combined $21 million in VC funding, from firms like Pintango Venture Capital, Shrem Fudim Kelner Technologies, Bassini Playfair & Associates, Time Warner and Millennium Materials Technologies. www.axismobile.com
Nortel Networks (NYSE: NT) has agreed to acquire Tasman Networks Inc., a San Jose, Calif.-based provider of enterprise routers. The deal is valued at $99.5 million, and is expected to close this quarter. Tasman has raised nearly $97 million in total VC funding since its 1998 inception, from firms like Mayfield, New Enterprise Associates, Parker Price Venture Capital and Harbinger Venture Management. www.nortel.com www.tasmannetworks.com Irvine Sensors Corp. (Nasdaq: IRSN) has acquired a 70% stake in Optex Systems Inc., a Richardson, Texas-based manufacturer of optical sighting systems and assemblies primarily for U.S. Department of Defense applications. The deal is valued at $14 million, plus the possibility of an additional $4 million in earn-outs over the next three years. Irvine Sensors financed the deal via a combination of $4.9 million in senior secured notes from Square One Bank and $10 million of subordinated notes from Pequot Ventures. Approximately $7.4 million of the Pequot debt is convertible into Irvine Sensors common stock at the rate of $2.60 per share. www.irvine-sensors.com Tessera Technologies Inc. (Nasdaq:TSRA) has acquired most of the assets of Shellcase Ltd., an Israel-based provider of wafer-level image sensor packaging technology. Under terms of the agreement, Tessera paid approximately $33 million in cash and hired a majority of Shellcase's employees. Shellcase has raised over $53 million in total VC funding since its 1994 inception, from firms like Ampal-American Israel Corp., Israel Infinity Fund, Platinum-Neurone Ventures, Sanyo Semiconductor and Glenrock Targacept Inc. and AstraZeneca PLC (NYSE: AZN) have entered into an exclusive global license and research collaboration agreement for the development and commercialization of Targacept’s proprietary compound TC-1734 to treat Alzheimer’s disease, cognitive deficits in schizophrenia and other cognitive disorders. The deal includes an initial $10 million payment, with Targacept ultimately eligible to receive up to $300 million in total payments. Targacept last year withdrew a proposed IPO offering, and has raised over $123 million in VC funding from firms like Nomura Phase4 Ventures, New Enterprise Associates, EuclidSR Partners, Oxford Bioscience Partners, R.J. Reynolds Tobacco Holdings, Burrill & Co. and Advent International. www.targacept.com
Towerbrook Capital Partners (f.k.a. Soros Private Equity) is raising up to $1.25 billion for its first independent fund, according to a regulatory filing. The firm already has secured around $592 million, and is using UBS as its placement agent. www.towerbrook.com DuPont Capital Management Corp. is raising upwards of $200 million for its second private equity fund-of-funds, according to a regulatory filing. www.dupontcapital.com Lightspeed Venture Partners has secured $450 million in limited partner commitments for its seventh fund, according to a regulatory filing. The filing indicates an upper target of $480 million. www.lightspeedvp.com Reservoir Venture Partners of
Palm Beach Capital Partners is raising upwards of $150 million for its second private equity fund, according to a regulatory filing. www.pbcap.com The Pitcairn Co. of Vic Young, a onetime partner with WI Harper Group, has been named senior vice president and CFO of ARC International (LSE: ARK), a UK-based provider of configurable CPU/DSP processor cores and application subsystems. www.arc.com Prahash Karnik has joined IDFC Private Equity as executive vice president. He has spent the past six years as director of Indian operations with Jardine Fleming Electra/Electra Partners Asia , and before that spent 11 years in various positions with Unit Trust of India.
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