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From:

"Dan Primack"

Name:

Dan Primack

Email Address:

Dan_Primack@fortune.chtah.com

Subject:

The Term Sheet - - Tuesday, September 21

Date:

21-09-2010 14:52:39
Message

Fortune Finance

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Term Sheet

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The Term Sheet by Dan Primack


Tuesday -- September 21, 2010

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Random Ramblings
Some quick notes before heading to New York City for some meetings and greetings
*** I just received my copy of Overhaul, the book in which Steve Rattner spends 315 pages on car czar-dom and just five paragraphs on
the pay-to-play scandal that nearly destroyed his former firm. No new info, except that he fingers Larry Summers as the leaker of news
that Rattner had accepted the Obama Administration's offer (which was reported by ABC News before Rattner had the chance to tell
Quadrangle employees or investors).
In an interview yesterday with the NY Times' Peter Lattman, Rattner gave two explanations for what (to me) is a major hole in his self-told
record: (1) It would be improper to write about an ongoing investigation; and (2) His publishers wanted more about Obama/autos and less
about personal issues.
I obviously can't argue with the second point, but the first one is really passing the buck. Rattner has had plenty of opportunities to put this
mess behind him, but has steadfastly refused to take any public accountability (virtually holding Quadrangle Group hostage for much of
the process). Blaming an ongoing investigation is like me saying the following about my high cholesterol: "You know I'd love to get
healthier, but there's all this steak that needs to be eaten."
Suffice to say, the term Chooch is not listed in the Overhaul index.
*** Speaking of pension fund investigations, Andrew Cuomo last week reached an agreement with ex-placement agent Bill White (who
also is the former president of the Intrepid Sea, Air & Space Museum in New York City). Seems he had helped raise money from New
York Common Retirement Fund for a fund-of-hedge funds sponsored by Guggenheim Partners, and then secured political contributions
for then-NY Comptroller Alan Hevesi from two Guggenheim staffers.

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No admission of wrongdoing by White, of course, save for the willingness to pay a $1 million penalty.
White was acting on behalf of placement agencies Ariane Capital and Pali Capital, but neither firm was slapped by Cuomo. In a statement,
Ariane said that it has not had any involvement with the investigation since responding to a subpoena in 2007.
More specifically, my understanding is that Ariane was effectively operating as two firms at the time: The main group run by Ray Kraftson
and a side group run by former owner Sam Shipley. It was Shipley who brought on White as a consultant to work on the Guggenheim
fund, without the knowledge of others at Ariane. That side biz has since been shut down, although Shipley remains on board at Ariane as
a managing director and chief compliance officer. Yes, that last part is a few steps beyond ironic.
*** Apax Partners and General Atlantic yesterday announced that they each acquired a 19% stake in Soufun, a Chinese real estate
classifieds website that just went public in New York. Each investment was valued at $163 million, with the shares being sold by Telstra
International Holdings.
Worth noting that both Apax and General Atlantic would have done the deal as a private buyout, had SouFun failed to price its shares.
*** Yesterday's column discuss the oddity of Hellman & Friedman waiting more than a year to invest out of its new fund. An investor
wrote in to remind me that H&F was very close to buying Neuberger Berman in late 2008, which would have "sucked down a lot of Fund
VI." H&F bailed out of that deal a few months later, thanks to an out tied to S&P 500 performance. By that time, however, it had already
committed itself to raising new capital.

"They were very open about the timing starting Fund VII during the process," the investor explained.
*** I spent some time on the phone yesterday with Bob Grady, the former Carlyle boss who has been named chairman of the New
Jersey's state investment council. Turns out that he and New Jersey Gov. Chris Christie have a relationship that far predates last
November's election.
Both men grew up in Livingston, N.J., where Grady encouraged the younger Christie to run for class president (Grady had previously
served in the position). Years later, when Christie expressed interest in becoming a U.S. attorney, it was Grady who called up Karl Rove to
get Christie's name in the ring

Five things you should read @Fortune.com









Pre-marketing, including venture capital and the impending pension crisis, why stop & go science funding hobbles progress, how
to get acquired by IBM, a VC asks to be taxed more and another brick in Quattrone's road.
Intel's cultural anthropologist
The world's most inept central bankers
When good bosses go bad (and vice versa)
Enemies to partners: Consolidation in the "free" credit report space

The Big Deal


Experian, operator of FreeCreditReport.com, has agreed to buy the assets of Mighty Net, operator of such websites as CreditReport.com.
No financial terms were disclosed for the deal, which we first reported yesterday on the Term Sheet blog.
It's a big deal because there is now one fewer player in a market that really shouldn't exist in the first place. All consumers are legally
entitled to receive one free credit report per year from each of the three reporting bureaus. Credit scores still cost money, but are free if
the score has caused an adverse action (job rejection, etc). Moreover, the "free" sites run by companies like Experian are really just short
trials that quickly snowball into paid, monthly subscriptions.

VC Deals

Immatics Biotechnologies GmbH, a German developer of therapeutic vaccines for the treatment of cancer, has raised 53.8 million in
Series C funding. MIG Verwaltungs and AT Impf GmbH were joined by return backers Dievini Hopp Biotech and Wellington Partners.
www.immatics.com
Nexant Inc., a San Francisco-based provider of intelligent grid software and clean energy solutions, has raised $43 million in new funding.
Oak Investment Partners and Intel Capital were joined by return backers TeleSoft Partners and Beacon. www.nexant.com

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Micromax Informatics Ltd., a maker of mobile handsets for the Indian market, has raised around $43 million in VC funding from Sequoia
Capital, Sandstone Capital and Madison India Capital. Last year, Micromax raised $45 million from TA Associates.
www.micromaxindia.com
Cardoz AB, a Swedish developer of drugs for treating cardiovascular inflammation, has held a second closing on its $17 million in Series
A round. Forbion Capital Partners led the new tranche, and was joined by YSIOS Capital Partners, Industrifonden and return backer
HealthCap.
Aryaka Networks, a Milpitas, Calif.-based provider of a cloud-based application acceleration and WAN optimization solution, has raised
$14 million in Series A funding. Backers include Trinity Ventures, Mohr Davidow Ventures, Nexus Venture Partners and Stanford
University. www.aryaka.com
Laser Light Engines, a Salem, N.H.-based maker of solid-state lighting, has raised $13 million in Series B funding. Backers include
Braemar Energy Ventures, Harris & Harris Group Inc. and Imax Corp. www.laserlightengines.com
NewBridge Pharmaceuticals, a Dubai-based specialty pharma and biologics company, has raised $12 million in Series B funding.
Kuwait Life Sciences Co. led the round, and was joined by return backer Burrill & Co. It previously raised $4 million. www.nbpharma.com
Panaya, a Menlo Park, Calif.-based provider of SaaS for automating SAP upgrades, has raised $6 million in VC funding from Hasso
Plattner Ventures. The money will be used to buy out existing investor Tamares Group. Other Panaya backers include Benchmark Capital
and Battery Ventures. www.panayainc.com
Data Impact, a Huntington Beach, Calif.-based provider of electronic invoice presentment and payment solutions, has raised $5 million in
new VC funding led by Zon Capital Partners. The company also secured a line of credit from Square 1 Bank. www.dataimpact.com
Chronix Biomedical, a San Jose, Calif.-based developer of disease-specific biomarkers based on DNA fragments, has raised $1.8
million in Series E funding. Prairie Gold Partners led the round, according to VentureWire. www.chronixbiomedical.com
Power Assure, a Santa Clara, Calif.-based provider of data center optimization software, has raised $1.5 million in VC funding from ABB.
The company previously raised over $18 million from Good Energies, Point Judith Capital, and Draper Fisher Jurvetson.
www.powerassure.com

Private Equity Deals

Accuvant, a Denver-based portfolio company of Sverica International, has acquired Ciphert, a Baltimore-based provider of cyber security
solutions. No financial terms were disclosed. www.accuvant.com
Agence des Participations de l'Etat is prepping a sale of minority interests in several French state-owned airports, according to Reuters.
Allied Specialty Vehicles Inc., a portfolio company of American Industrial Partners, has acquired ambulance manufacturer Road Rescue
from Spartan Motors Inc. No terms of the asset transaction were disclosed. www.alliedsv.com
Avista Capital Partners announced that it has agreed to buy the global auto care business of Clorox Co., which includes the Armor All
and STP brands. The deal is valued at $780 million in cash. www.clorox.com
KPS Capital Partners has acquired a control stake in Motor Coach Industries International Inc., a North American maker of intercity
highway coaches. No financial terms were disclosed for the recapitalization. www.mcicoach.com
Marlin Equity Partners has acquired Hospedia Ltd., a provider of bedside communication and multi-media services to UK hospitals. No
financial terms were disclosed. www.hospedia.co.uk
Nando's Group Holdings, a portfolio company of Capricorn Ventures International, has agreed to acquire Clapham House (LSE: CPH), a
UK restaurant company whose brands include Gourmet Burger Kitchen and Real Greek. The take-private deal is valued at 30.4 million.
www.claphamhouse.com
Rosetta, an interactive ad studio backed by Lindsay Goldberg, has acquired Level Studios, a San Luis Obispo, Calif.-based digital

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marketing, product development and user experience agency. No financial terms were disclosed. AdMedia Partners advised Level Studios
on the deal. www.rosetta.com

Exits
Finisar Corp. (Nasdaq: FNSR) has acquired Broadway Networks Ltd., a San Jose, Calif.-based provider of optical subsystems to the
equipment vendors for broadband access applications. No pricing terms of the all-cash deal were disclosed. Broadway Networks had
raised around $20 million in VC funding from firms like Pond Venture Partners. www.finisar.com
Naspers Ltd. (JSE: NPN) has acquired a control stake in Multiply Inc., a Boca Raton, Fla.-based operator of a social shopping website.
No financial terms were disclosed. Multiply had raised around $25 million in VC funding, from VantagePoint Venture Partners, Point Judith
Capital and Transcosmos Investments. www.multiply.com
Platinum Equity has sold NextiraOne Mexico, a Mexican systems integrator and technology services provider with around $60 million in
annual revenue, to Sonda SA. No financial terms were disclosed. Communications Equity Associates advised Platinum on the sale.

Other Deals
Capital IQ, a provider of data and analytics for financial professionals owned by Standard & Poor's, has acquired the research and
estimates business of TheMarkets.com. No financial terms were disclosed. www.capitaliq.com

Firms & Funds


Partners Group has closed a new direct investment fund with 650 million in capital commitments. The Switzerland-based firm already has
made several investments out of the fund, including Spanish-language textbook publisher Grupo Santillana and commercial coffee
provisions provider Kaffee Partner. www.partnersgroup.com www.capitaliq.com

Moving In, Up and On


Oshok Aram has rejoined Deutsche Bank as chief executive of the Middle East and North Africa. He had left the bank in July 2009 to
join private equity firm Abraaj Capital.
Jeffrey Blumin has joined LBC Credit Partners as a managing director in the firm's New York office. He previously spent three years
with Marathon Asset Management, where he formed a credit origination business focused on middle-market private equity.
www.lbccredit.com
Marcello Bottoli has joined Advent International as an operating partner, with a focus on the retail and consumer sectors. He is the
former president and CEO of Samsonite Corp., and most recently ran Louis Vuitton Malletier. www.adventinternational.com
Deepak Ghosh has joined Silverfern Group as head of the firm's industrials, chemicals and packaging merchant banking group. He
previously was with GE Capital. www.silfern.com
Paul Davison and Daniel Hoffer have joined Benchmark Capital as entrepreneurs-in-residence. Davison is the former VP of business
development for Metaweb, while Hoffer is a former Symantex executive who co-founded Couchsurfing.com. www.benchmark.com
Institutional Venture Partners has promoted Melanie Chladek to chief financial officer and administrative partner. He has been with the
firm since 2000. www.ivp.com
Charles Ward has joined Arcapita as its first chief investment officer. He also will serve as president of the Bahrain-based bank's private
equity and infrastructure practices. He previously was chairman of Lazard's asset management group. www.arcapita.com

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