A PICTURE'S WORTH

It is a foregone conclusion that in the future, there will be greater and greater demand for images of all kinds. The proliferation of media outlets around the world is driven not only by the growing population of consumers of media, but by the demand for highly specialised publications and websites catering to every taste and interest.

All of these outlets are hungry for pictures. Question is – what are they willing to pay for them?

The partners of San Francisco-based private equity firm Hellman & Friedman are hoping that the prices charged by Getty Images will at least hold steady as demand for the company's huge catalogue of images grows.

Last month, Hellman & Friedman agreed to purchase publicly traded Getty Images in a deal worth $2.4 billion (€1.6 billion). The transaction involves roughly $1 billion in equity, some of it rolled-over from the Getty Trust, tied to the family of oil tycoon J. Paul Getty. The company was founded in 1995 by Mark Getty, a grandson of J. Paul.

The relatively high percentage of equity in the buyout reflects, of course, the ongoing credit crunch, but also the high degree of uncertainty about the future of paid-for imagery. Although the company's catalogue of archival, impossible-to-duplicate photographs is unparalleled, it is facing stiff competition in the sale of lower-end imagery, called microstock. These generic images are for sale starting at $49 a pop through Getty Images. Competing sites offer similar types of images for less.

Still, anyone working at a media company can attest to the need for quality images to save websites and publications from turning into dull grey blocks of text. The need for imagery – any imagery – is particularly acute in business journalism, where an article about, say, the art of negotiation can be spruced up with a shot of two execs shaking hands. It's not as exciting Ali knocking out Frasier (a more expensive option which Getty Images also owns) but for 49 bucks it'll do.

BLACKSTONE, CPPIB TO BID ON CANADIAN WIRELESS SPECTRUM
A consortium including Canadian company Manitoba Telecom Services, the Canada Pension Plan Investment Board and The Blackstone Group made a $340 million (€221 million) deposit to join the upcoming Advanced Wireless Services spectrum auction in Canada. The deposit was made in the form of letters of credit to Industry Canada, a government division that will conduct a spectrum license auction beginning 27 May. If successful, each member of the consortium will take ownership of one-third of a new wireless company that will rely upon the spectrum. Should the consortium win the auction, it intends to appoint André Tremblay, former CEO of the cellular company Microcell, to manage the new company.

CANADIAN COURT APPROVES $52BN BCE BUYOUT
Canada's largest-ever agreed leveraged buyout was approved by the Quebec Superior Court. The court also dismissed bondholder lawsuits that threatened to impede the $52 billion (€33.8 billion) buyout of telecom giant BCE by Teachers' Private Capital, Providence Equity Partners, Madison Dearborn Capital Partners and Merrill Lynch Global Private Equity. Teachers' had previously indicated it might abandon the deal if the court ruled in favour of the bondholder group, as it would mean the investor consortium would be forced to buy out debenture holders. The transaction still requires regulatory approval from the Canadian Radio-television and Telecommunications Commission and Industry Canada.

VECTOR ACQUIRES SYMANTEC UNIT
Vector Capital has acquired Symantec's Application Performance Management business with additional investment from Greylock Partners. The Symantec unit will now operate as a stand-alone company called Precise Software Solutions. Although the purchase price was not disclosed, Vector and Greylock have committed a combined $50 million (€32.5 million) in growth capital aside from the purchase price. The application performance management industry helps large companies get the most out of their existing IT infrastructure. Precise was originally an independent company that went public in 2000. In 2003, the company was purchased by software company Veritas, which then merged with Symantec in 2004. The company currently has a staff of 200 and roughly 1,800 customers.

LINDSAY GOLDBERG INVESTS $500M IN ADVISORY FIRM
Lindsay Goldberg, a boutique New York investment firm, has invested up to $500 million (€329 million) in Duff Capital Advisors, an institutional investment management and advisory firm. DCA is “in discussions” with others to secure an additional $1 billion to $1.5 billion in financing, according to a statement. The institutional advisory firm was founded by Phil Duff, who previously founded FrontPoint Partners in 2001. A $9 billion alternative investment management firm, FrontPoint was sold to Morgan Stanley in 2006. Lindsay Goldberg, which is affiliated with Bessemer Holdings, closed a $3.1 billion private equity fund in September 2006. The firm typically invests between $50 million and $250 million in the manufacturing, financial services and healthcare sectors.

RRE, VENROCK BACK WEATHER EXCHANGE
US venture capital firms RRE Ventures and Venrock are among a group of investors providing $7.2 million (€4.7 million) in expansion capital to Storm Exchange, an electronic weather exchange allowing firms to determine weather-related risks and seek financial solutions to mitigate them. RRE and Venrock are the original backers of Storm, which was launched in April 2007. Since its launch, Storm has developed more than 500 proprietary benchmark weather indices as well as analytics and hedging solutions. The company says it is building the market for its products across other weather-sensitive industries including aviation, travel, construction and outdoor entertainment. Venrock, originally the venture capital arm of the Rockefeller family, is currently investing Venrock V, which closed on $600 million in April 2007.

TPG BIOTECH TEAM INVESTS IN SLEEP SOLUTIONS
TPG Biotech, part of the venture capital investment platform of US mega-buyout firm TPG, led a $20.5 million (€13.5 million) round of financing in medical device manufacturer Sleep Solutions. The investment was made through the TPG Biotechnology II fund. Existing investors MedVenture Associates, Emergent Ventures and Lava Ventures also participated. Sleep Solutions produces medical treatments and provides at-home diagnostic services for sleep-disordered breathing including obstructive sleep apnea (OSA). The company intends to use additional funding to develop sales and marketing capabilities, expand facilities and develop additional applications for its proprietary technologies.

MORGAN STANLEY TO PAY FOR CHILDCARE CENTRES
ABC Learning Centers agreed to sell Morgan Stanley Private Equity a 60 percent stake in its US childcare company Learning Care Group. The deal with ABC, which is the world's largest publicly traded childcare centre company, will put a Morgan Stanley portfolio company in competition with Bain Capital portfolio company Bright Horizons Family Solutions. Morgan Stanley will pay ABC Learning $750 million in cash, allowing the company to pay off some of its senior debt, which has been linked to its recent US expansion. Morgan Stanley has also agreed to pay an additional $30 million in 2009, as well as purchase notes convertible into 10 percent of ABC Learning's stock.