PE Week Wire — Friday, June 10

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Friday Feedback

The sun is shining, Danny Ainge is on the precipice of a giant blunder and I’m about to take my first vacation since last August. In other words, it’s time for some Friday Feedback.

 

The vast majority of email this week involved Tuesday’s column about the 51% Rule when it comes to awarding SBIR grants. A venture capitalist writes: “Our companies get a lot of SBIRs, and it is highly beneficial to the country that VC backed companies be able to compete for these (and the competition is fierce). As you noted, the research is generally oriented towards applications or extensions of importance to the government that the company would not otherwise pursue. Another critical subtlety is that the award of a phase 2 creates an implicit procurement authority for the government of the SBIR developed technology – this is a big deal.”

 

Someone affiliated with the SBIR program writes: “Note that the SBIR/VC issue goes way beyond NIH and life sciences alone. To be sure, the ‘ownership thing’ came up as a result of an NIH award that was challenged by a disgruntled grantee. But, if SBA comes down hard in favor of excluding ‘VC-controlled’ companies from the SBIR program, it will impact a significant portion of the American taxpayer’s $2 billion-federal SBIR early-stage investment in IT, Advanced Materials and Biotech (among others).”

 

Indeed, this is an important point that I neglected to mention. The SBIR program involves 11 different agencies, including NIH, Department of Defense, Department of Energy, National Science Foundation and the Environmental Protection Agency. While all of them technically are supposed to follow the 51% rule, the NIH is the only one known to be actively doing so. As such, life sciences companies are generally the only ones affected right now. The SBA oversees the entire SBIR program and officially endorses the 51% rule, but does not have any enforcement capabilities, which means that plenty of VC-controlled companies have gotten SBIR grants from places like DOD. If the ongoing forums and/or Congressional action lead to greater SBA oversight, however, this rule could begin to impact all sorts of companies. Again, go to the forums if you care about this issue (on either side).

 

*** Attorney Ken writes in on the issue of divorce affecting private equity partnerships: “Most well-drafted agreements would include a right to buy-out the spouse at a pre-determined price (or a price established via private, binding arbitration).The agreements typically provide that the buyout may be exercised in fairly short order and that the divorced spouse will haveno right to vote on GP or fund matters or inspect GP books and records at any time.”

 

*** Finally, tons of you wrote in to make light of my Paul Allen/Steve Allen mix-up. The best, however, came from Carlos, who suggested that my mistake may have been based more on looks, than on names. Check it out.

 

*** Publishing Note: I will be on vacation from next Monday until Monday, June 27. During that time I will not have regular access to email or voice mail (yup – an actual vacation). Please send all questions, compliments, complaints, tips, news items and spam to Adam.Reinebach@thomson.com. We’ll chat again when I return.

 

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    Top Three


eFunds Corp. (NYSE: EFD) has agreed to acquire WildCard Systems Inc., a Sunrise, Fla.-based provider of prepaid and stored value chain solutions to financial institutions, retailers and other payment issuers. The deal includes an initial payment of $228.8 million in cash (less a $22.8 million hold-back), plus a possible earn-out of up to $58.8 million. WildCard has raised over $75 million in VC funding since its 1995 inception, including a $14.5 million Series E round in 2001 at a post-money valuation of approximately $215 million. Company shareholders include Sutter Hill Ventures, GSC Partners, BA Venture Partners, First Data Corp. and Cleveland Pacific Equity Ventures. www.efunds.com www.wildsystems.com

 

Warburg Pincus is being sued for $650 million by founding shareholders of Irish telecom company QoS Networks Ltd., which went out of business in 2002. The plaintiffs allege that Warburg – the company’s controlling shareholder — breached its fiduciary duty to QoS, by preventing it from raising additional funding. Warburg told the Financial Times that the suit is “frivolous and without merit,” and also is counter-suing the founders for allegedly misleading the firm about QoS’ financial position. There also is a related $250 million punitive suit filed against Warburg by a group of QoS shareholders, although fellow private equity firm TowerBrook Capital Partners (f.k.a. Soros Private Equity) is not involved. www.warburgpincus.com

 

Keith Kalmus, a New York-area attorney known for representing cousin Daniel Pelosi in the murder of former KKR partner Ted Ammon, has been arraigned on drunken driven charges, following a deadly automobile accident Sunday afternoon in New York. The Suffolk County D.A. is expected to seek a vehicular manslaughter indictment against Kalmus, as the accident killed Eva Bertuccioli-Krapfenbaur of Belgium, and also seriously injured her sister-in-law Margot Krapfenbaur (on life support). Also injured in the crash were Bertuccioli-Krapfenbaur’s son, Claudio Bertuccioli, and his wife Rebecca McMillin. Claudio Bertuccioli is a principal with Rho Ventures, and already has been released from the hospital! .

    VC Deals

 

HyperQuality Inc., a Seattle-based provider of monitoring services for customer care centers, has raised $5.5 million in Series A funding co-led by Miramar Venture Partners and Rustic Canyon Partners. www.hyperquality.com

 

Right Hemisphere Inc., a Fremont, Calif.-based provider of graphics management solutions, has raised $12 million in Series B funding, according to a regulatory filing. Sutter Hill Ventures was joined on the deal by such return backers as Sequoia Capital. www.righthemisphere.com

 

Blue Lane Technologies Inc., a Cupertino, Calif.-based network security company focused on fixing the problem of un-patched servers, has raised $13.32 million in Series B funding, according to a regulatory filing. Return backers include Benchmark Capital and Matrix Partners. www.bluelane.com

 

Nanosolar Inc., a Palo Alto, Calif.-based developer of flexible solar cells, reportedly has raised $20 million. Mohr, Davidow Ventures led the deal, and was joined by Mitsui & Co., OnPoint (VC arm of the U.S. Army) and return backer Benchmark Capital. It is unclear if existing Nanosolar shareholder U.S. Venture Partners also participated. www.nanosolar.com

 

Miasole, a San Jose, Calif.-based manufacturer of thin-film solar cells, has raised $16 million in Series B funding, according to SiliconBeat.com. Kleiner Perkins Caufield & Byers led the deal, and was joined by unnamed return backers. The company raised $5.4 million in first-round funding in early 2004 from VantagePoint Venture Partners, Firelake Strategic Technology Fund, Garage Technology Ventures and Nippon Kouatsu Electric Company. www.miasole.com

 

Centive Inc., a Burlington, Mass.-based provider of incentive compensation management solutions, has raised $10 million in new VC funding. Key Venture Partners led the deal, and was joined by return backers Polaris Venture Partners and VSP Capital. www.centive.com

 

Whale Communications Inc., a Fort Lee, N.J.-based SSL VPN vendor, has raised $6.5 million in new VC funding from return backers Goldman Sachs, Soros Fund Management and BRM Group. The company previously raised $23 million in 2000 at a post-money valuation of approximately $100 million. In other Whale Communications news, the company named Roger Pilc, former COO of software company SMARTS, as its new CEO. He replaces company founder Elad Baron, who will remain on Whale’s board of directors. www.whalecommunications.com

 

    Buyout Deals

 

The Riverside Co. has acquired a 75% stake in Computer Press, a Czech Republic-based publisher of computer books and magazines in the Czech and Slovakian markets. www.cpress.cz

 

American Capital Strategies has acquired a 57% position in Unwired Technology LLC, a Plainview, N.Y.-based provider of wireless headphones for automotive entertainment systems. The deal is valued at $65 million, which takes the form of equity, a senior term loan, senior subordinated notes and junior subordinated notes. American Capital also is providing a revolving credit facility. Unwired CEO Lawrence Richenstein is rolling over a portion of his equity and will retain a significant ownership interest and continue to manage the company. www.americancapital.com www.unwiredtechnology.com

 

ABN Amro has received EU approval for its buyout of Denmark-based metal food packaging company Glud & Marstrand Invest AS, from Kirkibi AS, AscelAS and Nordea Pension. No financial terms have been disclosed.

 

    PE-Backed IPOs

 

Silicon Motion Technology Corp., a Taiwan-based fabless semiconductor company focused on the multimedia consumer electronics market, has filed to raise $115 million via an IPO of American depository shares (ADS). It plans to trade on the Nasdaq under ticker symbol SIMO, with Deutsche Bank Securities serving as the offering’s lead underwriter. Shareholders include Concord Venture Capital Group, Capital Bright Investments, Smartinvest Consultants and Bewise Investments.

 

    PE-Backed M&A


Oracle (Nasdaq: ORCL) Has agreed to acquire TimesTen Performance Software Inc., a Mountain View, Calif.-based provider of real-time data management software. No financial terms were disclosed for the deal, which is expected to close by the end of July. TimesTen has raised over $45 million in VC funding since its 1996 inception, from firms like Mayfield, Sippl Macdonald Ventures, Morgenthaler Ventures, Lightspeed Venture Partners, Intel Capital, Technology Crossover Ventures, ABS Ventures, BEA Systems, Hewlett-Packard and Tamir Fishman Ventures. www.oracle.com www.timesten.com

 

First Data Corp. (NYSE: FDC) has agreed to acquire EuroProcessing International from Reiten & Co. Capital Partners and Creati AS. No financial terms were disclosed. EuroProcessing International is Norway-based credit and debit card transaction processing company focused on Eastern Europe. www.europrocessing.no

 

CarsDirect.com Inc., a Culver City, Calif.-based operator of online car shopping services, has acquired 1-800 Communications Inc., a Hicksville, N.Y.-based provider of special finance auto leads to dealers. No financial terms were disclosed. CarsDirect has raised around $320 million of VC funding since its 1998 inception, from firms like MSD Capital, PC Partners, Clearstone Venture Partners, Foundation Capital, Goldman Sachs, TowerBrook Capital Partners, Rustic Canyon Ventures and JPMorgan Partners. www.carsdirect.com www.1800communications.com

    Firm & Fund News

Oak Hill Capital Partners has closed on $1.9 billion in LP commitments for its second buyout fund, according to a regulatory filing. The Fort Worth, Texas-based firm is looking to raise upwards of $2.5 billion

    Human Resources

Henry Simon, a special partner with Schroder Ventures Life Sciences, has been appointed non-executive chairman of Eyetech Pharmaceuticals Inc. (Nasdaq: EYET), where he has served as a director since July 2001. He replaces John McLaughlin, who resigned this week after Eyetech shares dipped nearly 50% on the news that a rival wet macular degeneration drug from Genentech had better-than-expected clinical results. www.eyetk.com

Roger Crandall has been named chief investment officer for Massachusetts Mutual Insurance Co., effective immediately. He replaces Stuart Reese, who was named MassMutual’s president and CEO last week. Crandall previously served as vice chairman, managing director and head of corporate securities for Babson Capital Management, a MassMutual investment management subsidiary. www.massmutual.com

John Vancura has been named vice president of business development for the private equity services division of The Bisys Group Inc. It is a newly-created position. www.bisys.com

David House has decided to retire from American Express Co., where he serves as group president of the Global Network and Establishment Services and Travelers Cheque and Prepaid Services Group. The move is effective later this year, at which point House plans to “devote more time to community service, working with venture capital startups and outside board and being with his family.” www.amex.com

 

THURSDAY, JUNE 9

Random Ramblings

*** In early April, this space reported that Summit Partners has launched simultaneous fund-raising efforts for both a late-stage/LBO fund (up to 50% control deals) and a venture capital fund (more downstream successor to the Summit Accelerator Fund). Specifically, I wrote that while the LBO fund would easily hit its $3 billion target, the VC one was “arguably a bit less certain.” It seems that I hit a bulls-eye in my first prediction, and missed the mark on the second.

Summit is going to easily raise both funds, and actually is more oversubscribed for its VC vehicle than for its LBO one, although the former is, admittedly, just one-tenth as large as the latter. The Boston-based firm held a first close in late May, and is expected to wrap everything up the week of June 20. It isn’t expected to accept more than the target capitalizations for either fund.

*** There are a couple of reports floating around the blogosphere that Mountain View, Calif.-based fuel cell company PolyFuel Inc. plans to price an IPO on London‘s AIM exchange. Most of the attention to this deal so far focuses on the geography, but folks should be paying equal attention to the pricing (particularly those who don’t yet “believe” in the ROI potential of cleantech companies).

PolyFuel apparently is going to raise Gbp12 million, which would give it an enterprise value of around Gbp40 million, or approximately $73 million. It’s initial VC funding round provided a post-money valuation of just $13.2 million, while a $15.6 million infusion in 2002 was post-valued at $35 million (according to our VentureXpert database). That’s big money for first-round backer Mayfield, and also not to shabby for later players like Intel Capital and Chrysalix Energy. Not amazing, but better than decent for a company in this unchartered line of work.

*** I got tons of response to Tuesday’s column on SBIR funding regulations, and will run a bunch of them tomorrow. In the meantime, you should know that the SBA is seeking public testimony on the majority-owned issue during several forums, including: Today in Atlanta, June 14 in Denver, June 16 in NYC, June 17 in Washington DC, June 20 in Chicago, June 22 in Dallas, June 28 in San Francisco and June 29 in Los Angeles. Such meetings already have occurred in Seattle, St. Louis and Portland, Maine. More info available at www.sba.gov/size.

*** Two days ago I had lunch with someone who spends a lot of time dealing with troubled private equity firms. Most interesting observation (his, not mine)? That the number one factor in destroying a general partnership is not poor returns, macro economic factors or generational issues. Instead, it’s when one partner gets divorced. Apparently, partner divorce can open up a large can of worms, as the spouse often requests all sorts of sensitive financial info, such as the carrying values of portfolio companies. I wonder how many PE firms inquire about the state of a perspective partners’ marriage? Can you even do that without the candidate walking out? Tricky stuff.

*** Tomorrow we’ll have Friday Feedback, but I’ll be on a two-week break after that. But don’t fret, because your PE Week Wire will continue uninterrupted. The news will be taken care of by our crack staff in New York, while the column will be sometimes written by regular pinch-hitter Adam Reinebach (my boss), and sometimes written by some guest columnists I lined up. For spam purposes, however, it will continue to look like it’s coming from my inbox.

Random Ramblings

*** In early April, this space reported that Summit Partners has launched simultaneous fund-raising efforts for both a late-stage/LBO fund (up to 50% control deals) and a venture capital fund (more downstream successor to the Summit Accelerator Fund). Specifically, I wrote that while the LBO fund would easily hit its $3 billion target, the VC one was “arguably a bit less certain.” It seems that I hit a bulls-eye in my first prediction, and missed the mark on the second.

Summit is going to easily raise both funds, and actually is more oversubscribed for its VC vehicle than for its LBO one, although the former is, admittedly, just one-tenth as large as the latter. The Boston-based firm held a first close in late May, and is expected to wrap everything up the week of June 20. It isn’t expected to accept more than the target capitalizations for either fund.

*** There are a couple of reports floating around the blogosphere that Mountain View, Calif.-based fuel cell company PolyFuel Inc. plans to price an IPO on London‘s AIM exchange. Most of the attention to this deal so far focuses on the geography, but folks should be paying equal attention to the pricing (particularly those who don’t yet “believe” in the ROI potential of cleantech companies).

PolyFuel apparently is going to raise Gbp12 million, which would give it an enterprise value of around Gbp40 million, or approximately $73 million. It’s initial VC funding round provided a post-money valuation of just $13.2 million, while a $15.6 million infusion in 2002 was post-valued at $35 million (according to our VentureXpert database). That’s big money for first-round backer Mayfield, and also not to shabby for later players like Intel Capital and Chrysalix Energy. Not amazing, but better than decent for a company in this unchartered line of work.

*** I got tons of response to Tuesday’s column on SBIR funding regulations, and will run a bunch of them tomorrow. In the meantime, you should know that the SBA is seeking public testimony on the majority-owned issue during several forums, including: Today in Atlanta, June 14 in Denver, June 16 in NYC, June 17 in Washington DC, June 20 in Chicago, June 22 in Dallas, June 28 in San Francisco and June 29 in Los Angeles. Such meetings already have occurred in Seattle, St. Louis and Portland, Maine. More info available at www.sba.gov/size.

*** Two days ago I had lunch with someone who spends a lot of time dealing with troubled private equity firms. Most interesting observation (his, not mine)? That the number one factor in destroying a general partnership is not poor returns, macro economic factors or generational issues. Instead, it’s when one partner gets divorced. Apparently, partner divorce can open up a large can of worms, as the spouse often requests all sorts of sensitive financial info, such as the carrying values of portfolio companies. I wonder how many PE firms inquire about the state of a perspective partners’ marriage? Can you even do that without the candidate walking out? Tricky stuff.

*** Tomorrow we’ll have Friday Feedback, but I’ll be on a two-week break after that. But don’t fret, because your PE Week Wire will continue uninterrupted. The news will be taken care of by our crack staff in New York, while the column will be sometimes written by regular pinch-hitter Adam Reinebach (my boss), and sometimes written by some guest columnists I lined up. For spam purposes, however, it will continue to look like it’s coming from my inbox.

Want to reach over 23,000 PE Week Wire subscribers? Learn How

    Top Three

 

Verus Pharmaceuticals Inc., a San Diego-based pediatric drug company, has raised $78 million in Series A funding. Domain Associates and Prospect Venture Partners co-led the deal, and were joined by Paul Royalty Fund, MPM Capital, Montreaux Equity Partners, Athenian Venture Partners and Windamere Venture Partners. In addition, the company received $20 million in product-specific royalty funding from Paul Royalty Fund. www.versuspharm.com

 

The Neiman Marcus Group Inc. (NYSE: NMG.A, NMG.B) has agreed to sell its private-label credit card accounts and related assets to HSBC Retail Services for approximately $640 million (including approx. $113 million in Neiman Marcus securitization liabilities). Neiman Marcus recently agreed to be acquired for around $5.1 billion by Texas Pacific Group and Warburg Pincus. It is unclear at press-time how the credit card sale will affect the overall buyout price.

Fonds de Reserve pour les Retraites (a.k.a. The French Pensions Reserve Fund), a state-owned system with nearly 20 billion euros under management, has hired London-based CampbellLutyens & Co.Ltd. to serve as financial consultant on its upcoming RFP to award several private equity management mandates. It would be the system’s first foray into the private equity market. www.fondsdereserve.fr

    VC Deals

Pixim Inc., a Mountain View, Calif.-based developer of digital imaging systems, has raised $12 million in Series A-1 recap funding. Honda Motor Co. Ltd. and Atrium Venture Partners were joined on the deal by return backers Mohr, Davidow Ventures, Mayfield, China Industrial Development Bank and Newbury Ventures. Pixim has raised over $85 million in total VC funding since its 1999 inception, including a $16.5 million Series C round in 2001 at a $108 million post-money valuation, and a $22 million Series D round in 2003. www.pixim.com

PeptImmune Inc., a Cambridge, Mass.-based drug company focused on the rare skin disease pemphigus vulgaris, has raised $18.66 million in Series C funding, according to a regulatory filing. Return backers include New Enterprise Associates, Prism Venture Partners, Vanguard Ventures, and MPM Capital. The company raised $41.2 million in a 2003 funding round at a post-money valuation of approximately $55 million. Genzyme Corp., which spun out PeptImmune in 2003 (after having bought it from Zero Stage Capital in 1999), remains a company shareholder. www.peptimmune.com

Plethora Technology Inc., a Charles Town, West Va.-based provider of secure mobile computing platforms has raised $1 million in Series A funding. Participants include Mountaineer Capital ($500,000), West Virginia Jobs Fund Investment Trust Board ($250,000) and The Calvert Social Investment Funds ($250,000). Calvert had previously provided Plethora Technology with $400,000 in seed capital. www.plethoratech.com

Clear Shape Technologies Inc., a Sunnyvale, Calif.-based provider of semiconductor DFM software, has raised in excess of $5 million in its second round of VC funding. Intel Capital led the deal, and was joined by KT Venture Group and return backers Telos Ventures, US Venture Partners and AsiaTech Management. www.clearshape.com

Osiris Therapeutics Inc., a Baltimore-based biotech company focused on adult stem cell research, has raised $50 million in combined equity and convertible debt financing. According to VentureWire, the equity tranche consists of $10 million. www.osiristx.com

Sky Mobilemedia Inc., a San Diego-based maker of mobile application software platforms for wireless handsets, is raising $15 million in Series B funding, according to a regulatory filing. It already has secured $10.5 million from insiders like Enterprise Partners. www.skymobilemedia.com

Soma Networks Inc., a San Francisco-based provider of last-mile wireless solutions, has raised approximately $23.56 million in Series B preferred equity funding and $21.7 million in convertible note funding, according to a regulatory filing. No additional information was disclosed. www.somanetworks.com

NordNav Technologies, a Stockholm, Sweden-based developer of software GPS receivers for the mobile and automotive markets, has received an undisclosed amount of VC funding from 3i Group PLC, Innovationskapital and Siemens Acceleration. www.nordnav.com

    Buyout Deals

Mersey Docks & Harbour Co., a UK-based port operator, has confirmed that it will be acquired for Gbp771 million by Peel Ports Ltd. Mersey had previously been in negotiations with Cinven and CVC Capital Partners. www.merseydocks.co.uk

GIMV and Maple Finance Group have agreed to sell Omnister Accessories NV to Sweden-based Thule Group for an undisclosed amount. Omnister is a Belgium-based supplier of European aftermarket accessories for recreational vehicles, was acquired by GIMV and Maple in 2001. Thule is controlled by Candover Investments. www.omnistor.com www.thule.com

Vedior NV has agreed to sell its minority ownership position in TriNet Group Inc. to General Atlantic for approximately $43 million. TriNet is a San Leandro, Calif.-based provider of business process outsourcing services for payroll, benefits and human resources. www.trinet.com www.vendior.com www.generatlantic.com

    PE-Backed IPOs

NeuStar Inc., a Sterling, Va.-based provider of clearinghouse services to the North American telecom market, has set its proposed IPO terms to 25 million common shares being offered at between $18 and $20 per share. It plans to trade on the Nasdaq under ticker symbol NSTR, with Morgan Stanley, CSFB and JPMorgan serving as co-lead underwriters. NeuStar was founded in 1996 as an operating division of Lockheed Martin Corp., and was acquired in 1999 in a management buyout lead sponsored by Warburg Pincus. Warburg holds a 71.59% pre-IPO stake, while other significant shareholders include MidOcean Partners (13.95%) and ABS Capital Partners (5.93%). www.neustar.biz

KKR Financial Corp., a San Francisco-based real estate investment trust (REIT) managed by buyout firm Kohlberg Kravis Roberts & Co., has set its proposed IPO terms to around 29.17 common shares being offered at between $23 and $25 per share. The REIT had raised $780 million last year via a Rule 144A offering. www.kkr.com

    PE-Backed M&A


Raritan Computer Inc., a Somerset, N.J.-based provider of products for managing IT infrastructure, has acquired defunct Oculan Systems Inc., a Raleigh, N.C.-based provider of server, network and desktop system health and security monitoring and management solutions for mid-sized enterprises. Oculan had raised $43 million in venture capital funding from TowerBrook Capital Partners (f.k.a. Soros Private Equity), TA Associates and W.R. Hambrecht & Co. www.raritan.com www.oculan.com

    Firm & Fund News

The PennsylvaniaPublic SchoolEmployees’ Retirement System (PSERS) today reported alternative investment returns of 10.68% percent for the nine-month period ending March 31, 2005 (fiscal year-to-date), and 26.97% for the 12-month period ending March 31, 2005. So far in 2005, PSERS has made commitments to KRG Capital Partners III (up to $100 million), Crestview Capital Partners (up to $150 million), Jefferies Capital Partners IV (up to $100 million), Bridgepoint Europe III (up to 200 million euros) and Barmoral Capital (up to 100 million euros). www.psers.state.pa.us

Birch Hill Equity Partners, a standalone successor to TD Capital Canadian Private Equity Partners, is planning to close its latest fund at the end of this month with Cdn$750 million, according to The National Post. The vehicle will target middle-market companies based in Canada.

    Human Resources

Michael Eisenberg has joined Benchmark Capital as a general partner in Israel, where he will help invest the $250 million Benchmark Israel II fund. He has spent the past eight years as a partner with Israel Seed Partners. www.benchmark.com

Marc Daniel has joined RBC Capital Markets as the senior New York-based managing director of mergers and acquisitions. He most recently served as a senior managing director with Bear Stearns & Co. www.rbccm.com

Larry Weeks has joined law firm Heller Ehrman White & McAuliffe as Of Counsel in the firm’s corporate securities, M&A and venture law group. He previously was a partner with Bingham McCutchen, and has brought with him clients like Redpoint Ventures, LoopNet Inc., Aprriso Corp. and Sabeus Inc. www.hellerehrman.com

WEDNESDAY, JUNE 8

Just Linking Around

A few links of note as I run downtown for a meeting:

*** There has been a lot of talk lately about the way that certain buyout firms share – or, in some cases, don’t share – certain transactional and monitoring fees. A big part of this focus was prompted by the excessive fees that TH Lee, Bain Capital and Providence Equity Partners took from the Warner Music piggybank, and how limited partners in Bain got less pro rata pop than did LPs in the other two funds. My take from this week’s edition of Buyouts.

*** More on VSP Capital, as firm founder Joanna Rees-Gallanter has confirmed the imminent shutdown of Fund III. It is worth pointing out, however, that this is far from the end of this ongoing saga. Next up? The possible battle for control of Fund II.

*** Paul Kedrosky takes on the wisdom of geography-focused shotgun investing. As a quick follow-on, it is worth noting that Paul’s criticism can be extended from the GP community into the LP community. It’s not a perfe