Oak abandons $825m Vertrue deal(2)

Oak Investment has dropped out of a consortium of firms planning to acquire internet direct marketing services firm Vertrue, after the bidding price was raised from $800 million to $825 million.

US venture firm Oak Investment Partners has walked away from a club deal after a $25 million bid increase was agreed by the consortium’s two other members, One Equity, the private equity arm of JP Morgan, and New York-based Rho Ventures. The latter two firms upped their offer for internet direct marketing services company Vertrue to approximately $825 million (€597 million)from the previously agreed $800 million, according to a statement issued by Vertrue.

One Equity and Rho, along with Oak Investment, had agreed to buy the company for $48.50 per share in March of this year. Yesterday the firm announced an amendment to the agreement, whereby One Equity and Rho upped the bid to $50 per share. Vertrue did not explain why the bidding price was increased.

Oak Investment’s portion of the investment will be covered by One Equity and Rho, and possibly Brencourt Advisors, a beneficial owner of 28.1 percent of Vertrue’s stock, according to the statement. All other terms of the deal remain unchanged, according to the SEC filings pertaining to the merger.

Oak Investment did not return calls for comment by press time.

Last June, Oak Investment closed a $2.56 billion fund, the largest-ever raised at the time. It also recently invested $25 million in Reunion.com, a US social networking website. The firm has $8.4 billion in capital under management and invests in the communications, information technology, health services and consumer retail industries.