Deal round-up

Mowbray launches European venture FoF; Apatech raises £6.5 million in Series B financing; KKR leads $250m pharma round; ARCH Venture closes $350m Fund VI;

Mowbray launches European venture FoF

Mowbray Capital, a European fund of funds firm founded by Guy Fraser-Sampson in 2003, has announced the launch of Mowbray European Venture LP. The European-focused venture fund of funds vehicle is seeking to raise between €100 million ($119 million) and €300 million.

Fraser-Sampson said that adopting a US-style venture model for the new vehicle was the way forward for European venture fund investors. “Europe can match or even exceed US returns once Europeans begin to accept and adopt the more successful US model and recognise it is a top decile game and that it is a few big winners which drive returns,”.

Apatech raises £6.5 million in Series B financing

MTI, the UK technology investor has announced that it is leading the Series B investment of £6.5 million (€9.7 million; $11.5 million) in Apatech, the specialist orthopaedics company, alongside further investment from 3i, the founder investor.

ApaTech develops and markets specialist synthetic bone graft materials for a variety of orthopaedic applications. The company was formed in 2001 as a 3i-backed spin-out from Queen Mary University of London.

KKR leads $250m pharma round

New York buyout firm Kohlberg Kravis Roberts has led a $250 million (€206 million) series B financing for specialty pharmaceutical company Jazz Pharmaceuticals.
The second round of funding dwarfs Jazz’s previous $15 million series A financing completed in April 2003. Returning investors Prospect Venture Partners and Versant Ventures were joined by newcomers that included Beecken Peety O’Keefe & Co., Golden Gate Capital and Thoma Cressey Equity Partners.
Jazz focuses on developing and commercializing drugs for treating neurological and psychiatric disorders, and according to a press statement, is “aggressively adding to its pharmaceutical product portfolio through licensing, acquisitions and collaborations.” The year-old company currently has no products out on the markets.

ARCH Venture closes $350m Fund VI

Chicago-base venture capital firm ARCH Venture Partners announced a final close for ARCH Venture Fund VI on $350 million (€283 million). ARCH’s previous fund closed on $380 million back in 2000.
Fundraising for the newest vehicle began in January 2003. About half of the investors were based in the US while the other half came from abroad. New investors in Fund VI accounted for almost 50 percent of total commitments. Returning LPs included State Farm, Dow Employee Pension Fund and Welcome Trust, while Alpinvest, University of California and UTIMCO came aboard as part of a new contingent of investors.
ARCH Fund VI three-to-five-year investment cycle will include between 22 and 25 investments. Single-round fundings range up to $5 million, but ARCH may invest up to $20 million over the lifetime of a portfolio investment. The firm invests in companies in life sciences; physical sciences including semiconductors, nanotechnology and electronic instrumentation; and information technology with a focus on communications. ARCH has made one investment so far with the new fund in nano-biotechnology company Senzyme.

Denmark’s Vaekstfonden backs Merlin III fund

Merlin Biosciences has received a boost to its fundraising for Merlin Fund III with the news that Danish venture capital organisation Vaekstfonden has committed an undisclosed sum. The capital commitment, which comes from Vaekstfonden’s fund of funds, is part of a strategic agreement between the two organisations that will see Vaekstfonden help source deals for Merlin in the Danish market.

“The Danish biotech industry has grown rapidly in recent years thanks to the significant investment by local VCs, such as Vaekstfonden, in the world class science and technology emerging from start-up companies,” said Mark Clement, chief executive of Merlin.

Noble raises £45m venture finance fund

Noble Fund Management, the investment management unit of UK investment bank Noble Group, has raised a £45 million (€67 million; $84 million) venture fund to provide asset-backed finance to growth companies throughout the European Union.
Noble Venture Finance I Limited Partnership (NVF), the firm’s first venture finance fund, has raised capital commitments from an undisclosed group of venture capital investors and institutions.

The fund will invest in growth companies that have recently received a round of funding from leading venture capital firms, and will underwrite and syndicate financings in both euros and sterling in the major markets of the EU. “The portfolio will be well diversified as to VC relationships, sector, geography and maturities,” the firm said in a statement.

Apax Partners and Inova Capital invest €39m in The Wisdom Group

Funds advised by Apax Partners, the private equity investment group and iNova Capital, the venture capital firm have invested €39 million ($46 million) in eight Spanish companies to create The Wisdom Group, specializing in interactive entertainment.

Apax and iNova invested €34 million and €5 million respectively in the group, which covers the interactive multimedia entertainment arena, including videogame development and distribution and “infotainment” companies.

Matrix completes £4.4m MBO of Apollo Lifts

Institutional fund, The Baring English Growth Fund (BEGF), advised by Matrix Equity Partners, the SME private equity firm formed from the merger of GLE Development Capital and The Matrix Group, has backed the £4.4 million (€6.6 million; $7.8 million) LBO of Apollo Lifts.

The deal is Matrix’s first transaction since it was formed by merger last month and Bob Henry, director of Matrix who structured the deal will join the board of Apollo.