Deal round-up 06/10/03

Sovereign backs funeral buyout; Scottish Equity Partners leads BioVex round; Accent takes Cefar stake; Atlas leads Arrow Therapeutics financing; ING, Capricorn back TiGenix; Matrix leads Recite investment; Benchmark Capital funds Yoox; Apax backs $11m Iris round;

Sovereign backs funeral buyout


UK mid-market private equity house Sovereign Capital has backed a £21m buyout of Laurel Management Services Limited, a UK group of funeral directors. The total funding comprises £17.4m to finance the buyout plus a further commitment to fund the group's expansion by organic growth and acquisition. Royal Bank of Scotland has provided the debt funding.


Laurel currently operates 29 funeral homes in regions including Kent, Hampshire, Hertfordshire and the Midlands. Sovereign Capital also has an investment in Westerleigh Group, an independent UK crematoria companies.


Scottish Equity Partners leads BioVex round


Scottish Equity Partners, the UK-based investor in emerging technologies, has led a £17m series C round for BioVex, an Oxford-based company developing vaccines for the treatment and prevention of cancer and chronic infectious disease.


Other new investors participating in the financing included ABN Amro Capital, Avalon Ventures, Credit Lyonnais Private Equity and Sitka Health Fund VCT. All of the company’s major existing shareholders also backed the round, including Merlin Biosciences, West LB, GeneChem Management, Temasek Holdings, Lloyds Development Capital and Technomark Medical Ventures.


The funds will be used to progress BioVex’s infectious disease vaccines for HSV II and HIV through early stage clinical testing.


Accent takes Cefar stake


Accent Equity Partners, the Nordic private equity firm, has taken a 55 per cent stake in medical technology company Cefar by a combination of new and existing shares. Financial terms of the transaction have not been disclosed.


Cefar, which operates within the field of electrotherapy, was established in Sweden in 1975 and reported turnover in 2002 of SKr125m (E14m). The company has around 60 employees.


The transaction is the first to be announced by Accent, formed by the merger of Euroventures and Nordico, since it held a first close of Accent Equity 2003, a mid-market buyout fund which is targeting E200m to E300m.


Atlas leads Arrow Therapeutics financing


Atlas Venture, the international venture capital life science investor, has led a significant round of financing for London-based anti-infectives drug discovery company Arrow Therapeutics.


Arrow raised more than £21m in what it described as a first close of a Series B funding round. The second stage of funding in this round is anticipated to close by the end of 2003, for an expected total of £25m. The investment will fund the company’s operations, R&D and marketing efforts.


Also backing the round are Tokyo-based NIF and ITX, and Scottish Widows Investment Partnership of the UK. Previous investors GIMV, Alta Partners, 3i Group, TVM, Unibio and NVM have all contributed fully to the new round. Tim Wilson, senior principal of Atlas Venture, and Alexandra Goll, a general partner of TVM, will join the company’s board of directors.


ING, Capricorn back TiGenix


TiGenix, a Belgium based biomedical company focusing on the functional repair of damaged and diseased musculoskeletal tissues, has closed a E12m financing round led by ING Private Equity and Capricorn Venture Partners. Funds advised by Auriga Partners and Fagus have also backed the round.


TiGenix, founded in 2000, is a spin-off from the Universities of Leuven and Gent. TiGenix will use the funding to bring its lead product, ChondroCelect, a cell therapy product for the functional repair of a damaged joint surface in the knee and other joints, to the market through a prospective clinical trial.


Matrix leads Recite investment


UK based private equity firm Matrix Private Equity has provided £1m as part of a £1.6m investment in Recite, a provider of managed services for large sales forces. Chairman David Southworth and CEO John Nicholson are also investing as part of the round, while Barclays Bank is providing the debt finance. Ashley Broomberg, director of Matrix, will join the board.


Benchmark Capital funds Yoox


Italian online fashion retailer Yoox has secured E6.5m in financing from US early stage investor Benchmark Capital which will enable it to further its international expansion. According to a press release, Yoox has increased revenues from approximately $1m in the year 2000 to $13m in 2002. The company achieved break-even in the fourth quarter of 2002.


Apax backs $11m Iris round


Iris Financial Engineering (IFEHL), formerly known as Iris Financial Systems, a provider of component-based financial software solutions for investment banks, has secured funds totalling $11m from Apax Partners.


Founded in 1990 in San Francisco, Iris Financial Engineering currently operates global development and sales offices in London, San Francisco, New York and Tokyo. It develops global trading, decision support and risk management solutions for global investment banks.


The company has also announced the appointment of Michael Laven as CEO and Robin Phillips as CFO, both of whom will be based in London. Michael Laven was previously CEO of Infinity Financial Technology. Robin Phillips was most recently the CFO of managed software solutions provider Civica.