PE Week Wire: Thurs., June 7, 2007

When we last discussed Trimaran Capital Partners, it was in the context of canceled fundraising and the resignations of several key staffers. Things looked bleak. Very bleak.

But a ray of sunshine seemed to emerge yesterday, when the competition reported that Trimaran had “assembled several hundred million dollars from at least two of its limited partners to form a so-called interim fund.”

All true, but lacking some salient details, according to a source familiar with the situation. First, the “fund” doesn’t have any management fees. Forget the standard 2% — we’re talking 0%. That’s good if you’re shopping for APR financing on a new car, but not if you’re raising a private equity fund. Moreover, the participating LPs have the right to reject any individual deal. It’s kind of like Trimaran raised an unregistered blank-check acquisition company.

Never say never for Trimaran’s rise from the near-dead, but definitely don’t say likely. The firm declined to comment.

*** The aforementioned Trimaran article also mentioned that Trimaran managing director Mark Dalton has left to join Avenue Capital Group as an executive vice president. That firm is in the midst of raising upwards of $5 billion for its fifth special situations fund, according to a regulatory filing (over $1.5 billion banked so far). Its fourth general special situations fund closed in 2005 on around $1.4 billion, while is later raised $1.4 billion for an Asia-focused special situations fund.

*** Speaking of fundraising, expect Battery Ventures to wrap up its eighth fund in time for the July 4th holiday. The only remaining question is whether or not it will hold to its $750 million cap, or take a bit more…

*** Whenever I write about excess liquidity among limited partners, emails begin flowing in from emerging fund managers that seem unable to get noticed (or at least get commitments). They complain, justly, that the majority of “emerging managers” program – particularly at large state pension funds – focus on second and third-time fundraisers, rather than first-timers. Well, stop sending me those emails, and instead direct them to a firm called Twin Bridge Capital Partners.

Chicago-based Twin Bridge quietly launched in 2005 with a $500 million inaugural fund, and came out of PR hiding this week with the addition of two new partners. Approximately 70% of its fund capital is allocated to fund-of-funds activities for small-to-mid-sized buyout funds – which it generally defines as $500 million or less. The remainder is dedicated to co-investments.

On the fund-of-funds side, managing partner Debbie Ackerman told me yesterday that Twin Bridge has a particular affinity for first-time managers, or veteran firms that have recently experienced significant change in their partnership rosters. Ackerman previously was with PPM America, as were new co-investment partners Joe Dimberio and Pat Lanigan.

Top Three

Biomet Inc. (Nasdaq: BMET) has accepted an increased buyout offer from a private equity consortium made up of The Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co. and TPG. The revised agreement raises the payout from $44 per share to $46 per share, for a revised equity value of $11.4 billion. Institutional Shareholder Services had been advising stockholders to reject the original offer, while the consortium says that its new offer represents “the absolute limit” of upward flexibility. Biomet has postponed its special shareholder meeting originally scheduled for tomorrow, and also said that, per the revised merger agreement, it will not pay its annual dividend.

New Sun Nutrition Inc., a Santa Barbara, Calif.-based maker of healthy beverages and nutritional supplements, has raised $25 million in Series A funding. Oak Investment Partners led the deal, and was joined by Radar Partners and individual Thomas Weisel.

Greenpark Capital has closed its third secondaries fund with €730 million in capital commitments. The UK-based firm acquires both fund and direct investment interests in the U.S. and Europe.

VC Deals

Singulex Inc., a Hayward, Calif.-based developer of biomarker diagnostic systems, has raised $19.1 million in Series D funding. OrbiMed Advisors led the deal, and was joined by return backers Fisk Ventures, Prolog Ventures and Advantage Capital. The company has now raised just over $30 million in total VC funding since 2002. Its R&D facilities are in St. Louis.

AdaptiveMobile, a Dublin, Ireland-based provider of mobile security software, has raised $14 million in second-round funding. Doughty Hanson led the deal, and was joined by Noor Financial Investment Co. and return backer Intel Capital.

StorSpeed Inc., an Austin, Texas-based developer of products that increase network storage performance, has raised $13 million in Series A funding, according to a regulatory filing. Backers include El Dorado Ventures, Hunt Ventures, Palomar Ventures and Vesbridge Partners.

ZeroG Wireless Inc., a Sunnyvale, Calif.-based developer of low-power RF chips, has raised $13 million in first-round funding. Participants include Cisco Systems, Greylock Partners and Morgenthaler Ventures.

Reactive Nanotechnologies Inc., a Hunt Valley, Md.-based developer of nano-scale furnaces for soldering applications, has called down $10.5 million of a $17 million Series C round, according to a regulatory filing. Siemens Venture Capital led the deal, and was joined by return backers like Sevin Rosen Funds and Toucan Capital.

Via (f.k.a., a Bangalore-based provider of mobile and online travel services for the Indian market, has raised $5 million in first-round funding from NEA-IndoUS Ventures.

Viamet Pharmaceuticals Inc., a Research Triangle Park, N.C.-based biotech company targeting metalloenzymes, has raised $4 million in Series A funding. Hatteras Venture Partners and seed backer Intersouth Partners co-led the deal.

Guardian Mobile Monitoring Systems Inc., a Vancouver-based provider of Web-based GPS solutions for the monitoring of assets, vehicles and loved ones, has closed the first tranche of its Series B round with over US$3 million. BC Advantage Funds led the deal, and was joined by Canadian and American angels.

PNP Therapeutics Inc., a Birmingham, Ala.-based cancer drug startup, has raised $925,000 in Series B funding from Birmingham Technology Fund and Phase 1 Holdings.

TicketReserve, a Chicago–based online ticket marketplace, has received an undisclosed amount of funding from CBS Corp. The company provides access to hard-to-get tickets by allowing users to reserve the right to buy face-value tickets. These vouchers can be bought and sold through a free-market trading system, or used to buy a face-value ticket if the event, such as a sports game, occurs.

Buyout Deals

Arsenal Capital has sold labeling company Renaissance Mark Inc. to Fort Dearborn Co., a portfolio company of Genstar Capital. No financial terms were disclosed. Arsenal acquired Renaissance Mark in 2002 for $85 million.

Brentwood Associates has acquired a majority interest in Paper Source Inc., a Chicago–based provider of high-end paper products and related items. No financial terms were disclosed. Susan Lindstrom and James York, the selling shareholders, will maintain a significant minority interest in the company. As part of the transaction, Brentwood has hired Sally Pofcher as Paper Source’s new CEO. She previously was with Gap Inc. as senior vice president of brand strategy and business development.

Mason Wells has acquired Oliver Products Co., a Grand Rapids, Mich.–based provider of packaging solutions to the global medical and prepared foods industries. No financial terms were disclosed. M&I Bank and US Bank provided senior financing for the transaction, while mezzanine and co-investment financing was provided by BMO Private Equity. Oliver Products was advised by Wolverine Capital Partners.

Montagu Private Equity has agreed to acquire Unifeeder AS, operator of the largest feeder network for container transportation in Northern Europe. No financial terms were disclosed. Jesper Kristensen, currently responsible for Unifeeder’s German, Baltic and Russian operations, will become Chief Executive of Unifeeder. Unifeeder was advised on the deal by PwC Corporate Finance, while Montagu was advised by Société Générale.

Triton Pacific has sponsored a recapitalization of MedKnowledge Group, a provider of medical communications and continuing medical education. No financial terms were disclosed for the deal, which was done in partnership with company management.

Clearlake Capital Group has acquired a 9% stake in, an Aliso Viejo, Calif.-based e-commerce company. No financial terms were disclosed. In other news, the company has withdrawn registration for an IPO.

HgCapital has acquired a majority equity stake in UK wind farm developer RidgeWind. No financial terms were disclosed.

TowerBrook Capital Partners has sold its position in French professional information group InfoPro Communications to Apax Partners. No financial terms were disclosed

Pe-Backed IPOs

Infinera Inc., a Sunnyvale, Calif.-based provider of digital optical networking systems, raised $128 million in its IPO. The company priced 14 million common shares at $13 per share ($10-$12 range), which gave it a market cap of approximately $1 billion. Infinera will trade on the Nasdaq under ticker symbol INFN, while Goldman Sachs servedas lead underwriter. It had raised over $336 million in total VC funding since its 2000 inception, from firms like Advanced Equities (9.3% pre-IPO stake), Kleiner Perkins Caufield & Byers (9.3%), Mobius Venture Capital (7.8%), RWI Ventures (5%), Benchmark Capital, Applied Materials Ventures, Cypress Semiconductor, Sprout Group, Venrock Associates, Worldview Technology Partners, Siebel Systems and Sutter Hill Ventures.

Spreadtrum Communications Inc., a Shanghai-based fabless maker of wireless chipsets, has filed for a $100 million IPO. It plans to trade on the Nasdaq under ticker symbol SPRD, with Morgan Stanley and Lehman Brothers serving as co-led underwriters. Shareholders include New Enterprise Associates (24.24% pre-IPO stake), Fortune Venture Group (11.61%) and Pacific Venture Partners (7.7%).

AuthenTec Inc., a Melbourne, Fla.-based provider of fingerprint sensors, has set its proposed IPO terms to 7.5 million common shares being offered at between $9 and $11 per share. It plans to trade on the Nasdaq under ticker symbol AUTH, with Lehman Brothers serving as lead underwriter. It has raised $71 million since 1999, from firms like Sierra Ventures (20.8% pre-IPO stake), Harris Corp. (18.7%), Carlyle Venture Partners (12.8%), Advantage Capital Partners (8.6%), Newlight Associates, TI Ventures, Knickerbocker LLC, Bencas Capital and Stonehenge Capital.

PE-Backed M&A

Rotorcraft Leasing Company LLC, a Broussard, La.-based portfolio company of H.I.G. Capital, has acquired Go Helitrans, a provider of transportation services for personnel and equipment to offshore oil & gas production platforms and drilling rigs in the Western Gulf of Mexico. No financial terms were disclosed.

PE Exits

IBM (NYSE: IBM) has agreed to acquire Watchfire Corp., a Waltham, Mass.-based provider of security and compliance testing software. No financial terms were disclosed. Watchfire has raised over $40 million in VC funding since 1999, from firms like Kodiak Venture Partners, Polaris Venture Partners, Ventures West, Goldman Sachs, Dain Rauscher and BancBoston Ventures.

Compass Partners has retained Goldman Sachs to help it sell Swiss fan maker Flakt Woods, one of the three remaining portfolio companies in its $917 million debut fund.

Firms & Funds

Partners Group of Switzerland has closed its latest direct buyouts fund with €500 million in capital commitments. The fund is already 35% invested in 24 transactions, and has held a partial exit via the IPO of RSC Equipment Rental.

Societe Generale Asset Management Alternative Investments (SGAM AI), the private equity arm of the French financial services group, has held a final close of its Central and Eastern Europe-focused fund with €156 million ($210m) of commitments, above its initial target of €150 million. The fund team has professions in Paris, Warsaw and Bucharest.

The City of Philadelphia Board of Pensions & Retirement has renewed its non-discretionary private equity consulting contract with Franklin Park Associates, which beat out rivals Alignment Capital and Aldus Equity Partners.

Access Microfinance Holding AG has received a $4.5 million commitment from CDC Group. Access Microfinance invests in microfinance institutions in Africa and Central Asia, and so far has attracted $28.7 million in total commitments.

Goodwin Procter LLP has opened a Palo Alto office, establishing its fifth California office in the past 14 months. Joining the firm as partners are: Byron Cooper, Gregory Bishop, April Abele and Thomas Fitzpatrick, formerly of Townsend and Townsend and Crew; Lloyd Winawer, formerly of Wilson Sonsini Goodrich & Rosati; and William Davisson, formerly of Latham & Watkins. Kyle Wombolt, formerly of Wilson Sonsini Goodrich & Rosati, joins the firm as counsel. Joining these new partners in Palo Alto will also be Kevin Dennis and Kathy Fields, corporate partners who will relocate from GP’s Boston headquarters to serve ! as Palo Alto co-chairs.

Human Resources

David Wezdenko has resigned as chief financial officer of Evercore Partners, less than a year after than firm went public. He will be replaced, effective immediately, by Robert Walsh, a senior partner at Deloitte & Touche.

Neil Banta has joined Lehman Brothers as managing director in the firm’s private equity fund marketing group. He previously held a similar position with Citigroup.

Victor Nesi reportedly has moved into Merrill Lynch’s private equity unit, after having run the bank’s tech/media/telecom group and I-banking in the Americas.

Thomas Hutchison III has joined KSL Capital Partners as a senior advisor. He also will be a senior advisor to KSL Resorts, a KSL portfolio company that manages six resort properties. Hutchison previously was CEO of CNL Hotels and Resorts Inc., a lodging industry REIT.