Private Equity
I'm pleased to announce that the next peHUB Shindig will take place on Wednesday, June 16 in Chicago. We’re doing it again at English, which is on North La Salle Boulevard. Per usual, tickets cost just $10 with proceeds going to support a local nonprofit that will be selected by event attendees. You can nominate a charity upon registration. Go here to get your ticket BIG thanks for our sponsors Conversus Asset Management and Crowe Horwath. Without sponsors, there are no Shindigs… I look forward to seeing a bunch of you there.
1 min read · 19 May 2010
Warren Lee, a venture partner with Canaan Partners, this week is doing the portfolio board two-step. He's moving off the board of Associated Content, due to its acquisition by Yahoo, and moved onto the board of Bit.tv, following Canaan's role as lead investor on a new $10.1 million funding round. I spent a few minutes on the phone with Lee yesterday, just after he touched down at SFO. Here's an edited transcript: Why sell Associated Content now? Canaan's been an investor in the company for three years, and people have constantly been talking about wanting to acquire it. It was kind of annoying -- in a good way -- and we kept having to fend people off. The company continued to grow and some of us wanted to keep building it as a stand-alone, but we decided to take a look at the bunch of strategic acquirers who were buzzing around... Yahoo's financial offer was attractive to both employees and investors. Probably just as important was that we wanted the company to go to a place where it would be well taken care of.
3 min read · 19 May 2010
Today's news cycle is all about Richard Blumenthal, the Connecticut senatorial candidate called out for falsely claiming to have "served in Vietnam" (common mistake -- I used to think I stormed the beach at Normandy). This über-gaffe obviously has nothing to do with private equity, but it's worth taking a moment to remember that Blumenthal is the same guy who once sued one of the world's biggest buyout firms for breach of fiduciary duty: Blumenthal was first elected Connecticut's Attorney General in 1990, and had his first private equity encounter later that decade when the state pension system became emroiled in a massive pay-to-play scandal. Federal prosecutors were responsible for sending then-Treasurer Paul Silvester to prison, but Blumenthal was instrumental in helping to recover certain monies and was widely lauded for efforts to stem government corruption. But it was in February 2002 that Blumenthal really caught the private equity industry's attention. That was when he sued Forstmann Little & Co. for breach of fiduciary duty, breach of contract and securities law violations.
3 min read · 18 May 2010
Morgan Stanley Investment Management yesterday announced that it has raised $585 million for a new global secondaries fund. From what I understand, however, there is no LPA provision about what will happen if Congress passes the Volcker Rule. Am I the only one who finds this odd? LPs and GPs plan for all sorts of contingencies when designing fund docs, from key-men triggers to LP default protocols to no-fault divorces. Wouldn’t it behoove both parties to know (officially) what happens if the federal government tells banks like Morgan Stanley that they no longer can house private equity funds?
1 min read · 18 May 2010
The CVCA and Thomson Reuters this morning released new data on Canadian PE and VC investment activity. Short story is that buyouts were up (slightly) and venture capital deals were down (although the rate of decline slowed). Here is the PE release and here is the VC release.
1 min read · 18 May 2010
For nearly the past decade, talk of VC-backed IPOs has included at least passing mention to alternative exchanges. London’s AIM, Hong Kong, Shanghai, India, etc. Basically: If the window is closed to smaller companies here, maybe it’s open elsewhere. The latest entrant is Taiwan, which recently changed its rules to allow listings by foreign companies. Its guinea pig will be a Campbell, Calif.-based chipmaker called Integrated Memory Logic (IML), which has raised around $8 million in VC funding from Storm Ventures, InveStar Capital and Telos Venture Partners. IML officially priced $40 million of shares last Friday ($39.6m in the bank, after fees) and will begin trading tomorrow. Fairly similar to a NYSE listing ceremony, except they bang a drum instead of a bell.
2 min read · 17 May 2010
BNY Mellon today released the results of a study showing that around 80% of limited partners expect private equity allocations to remain steady or rise over the next several years. The bank also surveyed GP sentiment, with Asian PE pros expressing the most bullish outlook. Not surprisingly, both sides say that management and transaction fees will be the highest priority during upcoming fund negotiations. Download the release here. You also can get more docs in the peHUB File Room.
1 min read · 17 May 2010
TowerBrook Capital Partners yesterday announced that it has partnered with John Janitz and Dom Schiano to explore investments in the industrial and related sectors. The pair previously served as “industry partners” with DLJ Merchant Banking Partners, and remain listed on the DLJMB website. Also still listed is fellow industry partner Scott Marden, who left two months ago to join Compass Partners (along with a couple of principals). All of this should serve as a reminder that DLJMB is nowhere near raising a new fund. It’s still investing out of a $2.1 billion vehicle that closed in Q3 2006, and which has less than $150 million left in uncommitted capital (following a recent $165m infusion info Swiss smart metering co. Landis+Gyr).
1 min read · 14 May 2010
Gilt Groupe, a New York-based online luxury retailer, has raised $35 million in new VC funding. The company previously raised around $48 million from General Atlantic and Matrix Partners. No new board members are listed in the filing. A recent WSJ article quoted Gilt Group chairman Kevin Ryan as saying that the company generated $170 million in 2009 revenue in 2009, and could reach $400 million and $500 million by the end of this year. That same piece speculated about a possible IPO filing.
1 min read · 14 May 2010
Cambridge Associates and the National Venture Capital Association today released new VC fund performance data, through the end of Q4 2009. I haven't had a chance to examine all of it yet, except to say that short-term performance improved, but 5-year and 10-year performance sagged. Not surprising on that last part, now that 10-year figures no longer include 1999 (and, as such, have moved into negative territory). Plan to have a bit more on this later this morning. For now, here is the press release and the benchmark report.
1 min read · 14 May 2010
