Random Ramblings A few quick notes before the trusty Pontiac heads down to Providence Airport, where I'll catch my plane to Raleigh-Durham for the VCIC event: ** Boston-based Summit Partners is in the fund-raising market with two offerings: One focused on late-stage private equity and LBOs, and the other focused on growth-stage venture capital. Limited partners expect the LBO fund to easily hit its $3 billion target, particularly given its predecessor's recent run of successful IPOs. The VC fund is arguably a bit less certain with its $250 million to $300 million target, particularly since Summit's original VC fund was still underwater as of the last time CalPERS updated its performance figures (9/30/04). Moreover, the venture group has lost three general partners since being founded, including founder Kip Sheeline (now with Levensohn Venture Partners) and Marc Friend, whose departure was first reported in yesterday's PE Week Wire. There are, however, a few things going for the VC fund-raising effort. First, Summit is raising both funds at the same time, which means that it could apply some not-so-subtle pressure to LPs looking for access to the LBO fund (I'm not saying they're doing that, just that it's an available - and not unprecedented -- option). Second, much of the original VC fund's troubles came from its 1999 vintage and early-stage focus. The vintage for Summit VC II is obviously changed, but the focus also has moved a bit later, which is a better fit with the firm's exhaustive deal-sourcing system. Oh, and they also have dropped the original VC fund's "Accelerator" tag, which made it sound like what Bill Gross might call his NASCAR team, if he were to buy one. Finally, a few personnel notes on Summit. Marc Friend says he is leaving on good terms, and that he simply wants to do earlier-stage inv*sting than Summit is pursuing (like what he used to do at USVP). His immediate plans are a trip with his wife to China and India, although he likely will join a West Coast firm upon his return. Also, I made a mistake yesterday in saying that Tom Jennings would be moving from Boston to Palo Alto. He will stay put in Beantown, although the part about his impending promotion from VP to principal was accurate (all apologies Tom). ** Sticking on the personnel tip for a moment, a pair of Silicon Valley happenings to share. First, Intel Capital has lost yet another senior executive. This time it's Claude Leglise, whose last day will be Friday. You might remember that Intel Capital president John Miner announced his resignation on March 24, which really is a lot of senior-level transition for one firm. even one as large as Intel Capital. Go to www.privateequityweek.com for the complete story. ** In unrelated personnel news, PE Week has learned that Mark Pincus has stepped down as CEO of online classified company Tribe Networks Inc. This is similar to the transition that occurred at Pincus' previous company Support.com, and basically is a case of Pincus being a better software guy than managerial/marketing guy. He plans to stay at the firm on a fulltime basis, and says that the search for a new CEO began late last year. No word yet on the newbie's identity, but a formal announcement is expected to come by the end of April. ** I never used to care much for The West Wing, but last night's episode was the single best hour of dramatic television I've seen since the pilot for NYPD Blue. Simply amazing. ** Tomorrow's PE Week Wire column will be written by Ryan Delaney of Stag Capital, who won our 3rd Annual March Madness contest (this is part of his prize). I'll still be taking care of the news section from down in North Carolina, however, and the email will originate from the regular domain (i.e., no need to change your settings). Have a great weekend.
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Elevation Partners has lost out in its efforts to acquire UK-based Eidos PLC, a publicly-traded video game maker known for its "Tomb Raider" series. The Menlo Park, Calif.-based buyout firm agreed last month to buy Eidos for 50 pence per share (approx. $135 million), but one day later was bested by a 72.8 pence per share offer from rival game-maker SCi Entertainment Group PLC. Eidos has now accepted the SCi Entertainment offer, after Elevation failed to increase its bid. www.eidos.com www.elevation.com Claude Leglise, a vice president at Intel Capital, will step down this Friday, in the second major departure from the venture unit in less than a month. Two weeks ago, Intel Capital President John Miner announced that his last day would be June 1. www.intel.com Spectrum Equity Investors reportedly has sponsored a leveraged recap of Classic Media Inc., a New York-based owner of cartoon and television characters like Mr. Magoo and The Lone Ranger. Spectrum's participation came in at around $75 million, with existing shareholders like Pegasus Capital Advisors and Random House Ventures retaining a minority position. In related news, Classic Media Inc. is considering a bit for children's television programmer HIT Entertainment PLC, which would be backed by both Spectrum and Thomas H. Lee Partners. Both Apax Partners and Lions Gate Entertainment already have made bits for HIT. www.classicmedia.com
Picolight Inc., a Boulder, Colo.-based maker of optical transceivers and components, has held a $13 million first close on its latest round of VC funding. The company hopes to raise between $4 million and $7 million in additional capital during the second quarter. It now has raised over $100 million in total private funding since its 1996 inception. www.picolight.com Third Brigade Inc., an Ottawa, Ontario-based provider of deep host intrusion prevention solutions, has raised Cdn$6 million in Series A funding. BCE Capital and Celtic House Venture Partners co-led the deal, and were joined by seed-stage backer BDC Venture Capital. www.thirdbrigade.com Diagnostic Ultrasound Corp., a Bothell, Wash.-based medical device company, has closed the first tranche of a $34 million capital commitment from DW Healthcare Partners and Rho Private Equity. www.dxu.com EnOcean GmbH, a Germany-based provider of battery-less switches and sensors, has raised 10 million euros in third-round funding. Backers included 3i Group, BayTech Venture Capital, SAM Private Equity, Wellington Partners and Siemens Venture Capital. www.enocean.com
Kohlberg, Kravis, Roberts & Co. has completed its acquisition of Toronto-based building products company Masonite International Corp. (NYSE: MHM), at a price of Cdn$42.25 per share. www.masonite.com www.kkr.com Barclays Private Equity and 3i Group have sold their ownership position in INBIS Group PLC to AssystemBrime SA for an undisclosed amount. INBIS Group is a UK-based provider of independent design and engineering support services, which was formed via a 1997 management buyout co-sponsored by Barclays and 3i. www.inbis.com Odyssey Inv*stment Partners has agreed to acquire Neff Corp. (OTC: NFFCA), a Miami, Fla.-based construction and industrial equipment rental company. The deal is valued at $510 million, including $240.5 million in equity. Company management will retain a significant ownership position. ClearLight Partners has led buyout of Switchcraft Holdings Inc., a Chicago-based maker of electronic connectors and cable assemblies. Company management also participated. No financial terms were disclosed for the deal, which also included senior note financing from Antares Capital and subordinated note funding from Black Canyon Capital. www.clearlightpartners.com www.switchcraft.com Perry Capital has agreed to acquire mid-market commercial finance companies Capital Factors Inc. and Capital Tempfunds Inc. from the Union Planters Bank, a division of Regions Financial Corp. (NYSE: RF). No financial terms of the acquisition are being disclosed, although Perry Capital has said that it will inv*st up to $100 million to support its new acquisitions. www.perrycapital.com
CVC Europe says that it has given up its battle to buy publicly-traded Swiss flooring company Forbo International SA. www.cvceurope.com The Carlyle Group has acquired French semiconductor metrology company Cameca from an inv*stor consortium led by Barclays Private Equity, according to Dow Jones. www.cameca.fr Accent Equity Partners has agreed to buy the BakeMark Sweden unit of Dutch food conglomerate CSM NV for approximately 8.75 million euros, according to Dutch press reports.
Freightcar America Inc., a Chicago-based maker of railroad freight cars, closed its first day of trading up 10.68% to $21.03 per share. The company traces its roots back to 1901, and was owned by Bethlehem Steep Corp. from 1923 to 1991. It then was purchased by Johnstown America Industries (now known as TTII), and resold in June 1999 to an investor group that included company management, Trimaran Capital Partners and John Hancock Life Insurance Co. www.johnstownamerica.com
Progress Software Corp. (Nasdaq: PRGS) has acquired Apama Inc., a Cambridge, UK-based provider of event steam processing technology, with a particular focus on the financial services industry. The deal was valued at $25 million, net of cash acquired. Apama was founded in 1999, and had raised VC funding from The Carlyle Group, Anschutz Inv*stment Co. and Providence Inv*stment Company Ltd. www.progress.com www.apama.com Esmertec AG, a Switzerland-based provider of software for mobile phones and embedded devices, has taken a majority ownership position in eValley Inc., a Japan-based exponent for Java software development. No financial terms were disclosed for the deal. Esmertec took a minority stake in eValley in July 2002, with an option for controlling interest, which now has been exercised. Esmertec has raised VC funding from Credit Lyonnais Private Equity, Partners Group, Sofinnova Partners, Rothschild Ventures, BV Group Ventures, Earlybird Venture Capital and BV Group Ventures. www.esmertec.com www.evalley.co.jp
Inter-Atlantic Group has launched its second private equity fund focused on the financial services industry. It is targeting $150 million, with Bentley Securities and Trinity Group serving as placement agents. www.interatlanticgroup.com 3i Group is considering a sale of up to 800 "legacy portfolio companies" on the secondary market. The news was reported in this morning's Times of London, and was confirmed by a 3i spokeswoman. The companies likely would be sold either individually or in small groups, and 3i says that there is no sense of urgency. www.3i.com AXA Private Equity is planning to launch venture capital-focused offices in both London and Singapore. Ivan Bernard-Brunel, a former principal with Crescendo Ventures, will run the office, assisted by former Credit Lyonnias professional Pierre-Emmanuel Boulic. No information was disclosed about Singapore-based personnel. www.axaprivateequity.fr Bard Capital Partners has launched as a mid-market buyout firms with offices in New York and Denver. It also announced its first acquisition, by buying the Contractor and Industrial Products Group of International Surface Preparation Corp. The deal was valued at $130 million.
The Ontario Teachers' Pension Plan has promoted Mark Wiseman to vice president of funds and inv*stments. Since joining OTPP in 2002, he has been responsible for all direct and indirect private equity commitments. In other OTPP news, the group also has promoted Rosemarie McClean to vice president of member services and Ron Lepin to vice president of infrastructure. www.otpp.com Rod Paige, former U.S. Secretary of Education, has joined the advisory board of New York-based private equity firm Leeds Weld & Co. www.leedsweld.com Brown Gibbons Lang & Co. has promoted four managing directors to the position of partner, and said that co-founders Michael Gibbons and Scott Lang have assumed the titles of chairman and CEO, respectively. The new partners are Scott Berlin, James Miller, Stephen Miles and David Sulaski. In other personnel news, the firm has promoted William Watkins to director, Cameron Miele to vice president, Scott Hasley to director and Michael Shaffer to senior associate. www.bglco.com Marilyn Selby Okoshi has joined law firm Katten Muchin Zavis Rosenman as a partner, where she will focus on the organization and representation of hedge funds and private equity funds. She previously served as a partner with Coudert Brothers LLP. www.kmzr.com
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April 7, 2005 
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