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Term Sheet — Wednesday, February 3

Feb 03, 2016

Random Ramblings

Greetings from Los Angeles, where later this morning I'll be moderating a panel of limited partners in venture capital funds. Certainly we'll discuss such issues as liquidity (or lack thereof), portfolio construction and the continuing proliferation of new micro-VC funds. Some notes as the local sun comes up...

•  Secondary stuff: I spoke to a couple of secondary private equity buyers earlier this week, both of whom believe that new private equity deal-flow is falling off a cliff (due largely to the new credit crunch). They also were unified in saying that the recent public equities troubles have not generated new secondary deal-flow from LPs who are experiencing (or worried they will soon experience) another denominator effect. The one economic factor that has recently driven secondary opportunity is dollar-yuan exchange flux.

•  Smart man: Goldman Sachs CEO Lloyd Blankfein was on CNBC this morning, when he was asked if he was supporting Hillary Clinton's presidential campaign (as he had done back in 2007/2008). His reply was clearly designed to keep him out of Bernie Sanders TV ads: "I don't want to help or hurt anyone by giving an endorsement."

•  Speaking of CNBC appearances: Yahoo CEO Marissa Mayer was on this morning, discussing her company's recent earnings, layoffs and plans to explore strategic alternatives for its core Internet business. On that last point, she simply does not seem to be on board ― which is different than being on the board, which she is ― which could only present additional complications for potential Yahoo suitors.

•  New firm alert: Marc Lipschultz has stepped down as head of energy and infrastructure investing at KKR, in order to form a new firm with GSO Capital co-founder Doug Ostrover (who left GSO last year, ostensibly to form a family office). According to Bloomberg, the new shop will be called Owl Rock Capital, and will focus on making loans to small and mid-sized businesses (across industry).

As for KKR, existing Houston-based member Robert Antablin will become head of the Americas energy private equity team. Houston-based member David Rockecharlie will become head of energy real assets, while Raj Agrawal (Menlo Park) and Jesus Olmos (London) will become global co-heads of infrastructure.

•  Today in Theranos: In late October, Theranos CEO Elizabeth Holmes pledged that she would let outside researchers from The Cleveland Clinic study her company's technology and publish their findings in a peer-reviewed journal. But nearly 100 days later, the process has not yet begun. Moreover, a Theranos spokeswoman admits that there is no timetable for getting the Cleveland Clinic arrangement underway. Fortune's Roger Parloff has more.

The state of venture capital: The event I'm attending this morning is hosted by Upfront Ventures, where partner Mark Suster will make a data-driven presentation about the current state (and future) of venture capital. He's also incorporated a bunch of his slides into a Fortune post, which you can find by going here.

THE BIG DEAL

• Veolia (Paris: VIE) has agreed to acquire Kurion Inc., an Irvine, Calif.-based provider of nuclear waste management technologies. The deal is officially valued at $350 million, although a source close to the situation says that it's closer to $365 million (not including around $35 million in Kurion cash on hand).

This is a pretty big win for the VC-backed cleantech sector, which hasn't seen too much success in recent years. Particularly given that Kurion's investors ―including Lux Capital, Firelake Capital Management and Acadia Woods Partners -- only invested around $5 million. There had been original plans to raise much more, but Kurion won an early (and unexpected) contract to help in the clean up of the 2011 Fukushima nuclear disaster in Japan in 2011. That deal brought in enough cash to let Kurion become profitable (and acquisitive). www.kurion.com

VENTURE CAPITAL DEALS

•  Skybox Security, a San Jose, Calif.-based provider of security analytics, has raised $96 million in equity funding from the growth equity affiliate of Providence Equity Partners. The company previously raised just under $50 million from firms like Susquehanna Investment Group, Benchmark, Carmel Ventures, Lightspeed Venture Partners, Glynn Capital Management, Rembrandt Venture Partners, Mitsubishi and Valley Venture Capital. Read more.

•  Travelstart, an online travel agency in Africa, has raised $40 million from Amadeus Capital and mobile services operator MTN. www.travelstart.co.za

•  Spero Therapeutics, a Cambridge, Mass.-based developer of treatments for bacterial infections, has raised $30 million in Series B funding. Return backers include Atlas Venture, S.R. One, Partners Innovation Fund, MRL Ventures, Lundbeckfond Ventures and The Kraft Group. www.sperotherapeutics.com

•  Lamudi, a real estate classifieds site operating in Asia, South America and MENA, has raised €29 million in new funding. Return backers include Rocket Internet (via a JV with Qatar-based Ooredoo), Holtzbrinck Ventures and Tengelmann Ventures. Read more.

•  Curalate, a Philadelphia-based visual commerce solution, has raised $27.5 million in Series C funding. NEA led the round, and was joined by fellow return backers First Round Capital and MentorTech Ventures. www.curalate.com

•  Avalanche Technology Inc., a Fremont, Calif.-based developer of memory technologies, has raised $23 million in new equity and debt funding. Equity investors include Thomvest Ventures, Vulcan Capital, Rogers Venture Partners and VTB Capital. The debt facility came from Horizon Technology Finance. www.avalanche-technology.com

•  Pear Therapeutics, a Boston-based developer of prescription digital therapies, has raised $20 million in new VC funding. Backers include 5AM Ventures, Arboretum Ventures, JAZZ Venture Partners and Bridge Builders Collaborative. www.peartherapeutics.com

•  eSentire Inc., a Canadian provider of managed cybersecurity services, has raised US$19.5 million in new VC funding. Edison Partners and Georgian Partners co-led the round, and were joined by Cisco Investments, Northleaf Ventures Catalyst Fund and Information Venture Partners. www.esentire.com

•  Geofeedia, a Chicago-based provider of real-time location-based intelligence solutions, has raised $17 million in new funding. Silversmith Capital Partners led the round, and was joined by return backers like Hyde Park Venture Partners. www.geofeedia.com

•  FiscalNote, a Washington, D.C.-based developer of a platform for analyzing government risk, has raised $10 million in Series C funding. Visionnaire Ventures and Green Visor Capital co-led the round, and were joined by NEA, Jerry Yang, Mark Cuban, 645 Ventures, Renren, Plug and Play, SF Capital, Perle Ventures and Conversion Capital. www.fiscalnote.com

•  StayNTouch, a Washington, D.C.-based provider of mobile technologies and property management systems for hotels, has raised $9.5 million in new VC funding co-led by Concur and Shiji (Hong Kong) Ltd. www.stayntouch.com

•  Agrible Inc., a Champaign, Ill.-based provider of predictive analytics tools for growers and agricultural companies, has raised $4.1 million in Series A funding from Flyover Capital, Serra Ventures and Archer Daniels Midland. www.agrible.com

•  Salesfloor, a San Francisco-based SaaS platform that enables customers to shop online with their local store and associate, has raised $3 million in seed funding led by BDC Capital IT Venture Fund. www.salesfloor.net

•  Thumzap, an Israeli app that enables teen online shopping and parent permissioning, has raised $3 million in seed funding from Sierra Wasatch Capital and individual angels. Read more.

•  JASK, a San Francisco-based AI startup focused on cybersecurity, has raised $2 million in seed funding led by Battery Ventures. The company was founded by Greg Martin, who previously started ThreatStream. www.battery.com

PRIVATE EQUITY DEALS

•  Centre Lane Partners has agreed to acquire Vitamin World, the U.S. retail business of NBTY Inc. No financial terms were disclosed. NBTY is a Ronkonkoma, N.Y.-based nutritional supplements company owned by The Carlyle Group. www.nbty.com

•  Cerberus Capital Management “has emerged as a suitor” for all or part of Arrium (ASX: ARI), an Australian provider of iron ore and other steelmaking raw materials, according to local media reports. A deal could be valued at between A$1.8 billion and A$2 billion. Read more.

•  CIVIQ Smartscapes, a Milford, Mass.-based portfolio company of JMC Capital Partners, has acquired Elevate Digital, a Chicago-based developer of street-level, interactive software technology. No financial termas were disclosed. Sellers include Advantage Capital Partners. www.civiqsmartscapes.com

•  Court Square Capital Partners has acquired NDC, a Nashville, Tenn.-based healthcare supply chain company and distributor of consumable medical supplies. No financial terms were disclosed. Sellers include Silver Oak Services Partners. www.ndc-inc.com

•  The Gores Group has acquired VITAC Corp., a Canonsburg, Penn.-based provider of captioning and related services to industries like media and education, from Merrill Corp. No financial terms were disclosed. www.vitac.com

•  IPC Systems, a Jersey City, N.J.-based provider of communications and IT solutions to global trading floors, has acquired Etrali Trading Solutions, a France-based provider of compliance and unified communications solutions, from The Gores Group. No financial terms were disclosed. IPC was acquired in early 2015 by Centerbridge Partners for $1.2 billion. www.ipc.com

•  Summit Partners has acquired Perforce Software, an Alameda, Calif.-based vision control and collaboration platform. No financial terms were disclosed. In related news, Janet Dryer (former CEO of HelpSystems) will become Perforce Software’s new CEO. www.perforce.com

IPOs

•  BeiGene Ltd., a Beijing-based developer of immune-oncology therapeutics, raised $158.4 million in its IPO. The company priced 6.6 million American depository shares at $24 per share, compared to original plans to offer 5.5 million ADS at between $22 and $24 per share. It will trade on the Nasdaq under ticker symbol BGNE, while Goldman Sachs, Morgan Stanley and Cowen & Co. served as lead underwriters. The company reports a $15.8 million net loss on $2.8 million in revenue for the first six months of 2015. BeiGene has raised over $170 million in VC funding from Baker Brothers Life Sciences (25.8% pre-IPO stake), Hillhouse Capital (9.9%), Merck Sharp & Dohme Research (7.7%) and CTIC Capital Partners (6.4%). www.beigene.com

•  Editas Medicine, a Cambridge, Mass.-based genome editing company, raised $94 million in its IPO. The company priced 5.9 million shares at $16 per share (low end of offering range), for an initial market cap of around $571 million. The pre-revenue company will trade on the Nasdaq under ticker symbol EDIT, while Morgan Stanley and J.P. Morgan served as lead underwriters. Editas has raised around $210 million in VC funding, from firms like Flagship Ventures (16.6% pre-IPO stake), Polaris Ventures (15.6%), Third Rock Ventures (15.6%), Boris Nikolic (8.9%), Deerfield Management (5.7%), Fidelity (5.7%), Viking Global Investors (5.7%), T. Rowe Price, Google Ventures, Jennison Associates, Khosla Ventures, EcoR1 Capital, Casdin Capital, Omega Funds, Cowen Private Investments and Alexandria Venture Investments. www.editasmedicine.com

EXITS

•  Aquiline Capital Partners and Genstar Capital have retained Moelis to help find a buyer for AssetMark Inc., a Concord, Calif.-based provider of investment solutions, according to Dow Jones. www.assetmark.com

•  Apax Partners has agreed to sell its 55% stake in TH Asia Ltd., the joint venture for Tommy Hilfiger in China, to partner PVH Corp. (NYSE: PVH) for $172 million (net of around $100m in cash). The deal is expected to close in early Q2. Read more.

•  Microsoft (Nasdaq: MSFT) has agreed to acquire SwiftKey, a London-based maker of a predictive smartphone keyboard. TechCrunch reports that the deal is worth around $250 million. SwiftKey had raised over $22 million in VC funding from firms like Accel, Octopus Investments, Cambridge Capital Group and Index Ventures. Read more.

•  Ningbo Joyson Electronic Corp. (China) has agreed to acquire Key Safety Systems, a Sterling Heights, Mich.-based maker of auto airbag systems, for $920 million. Sellers include Crestview Partners, FountainVest Partners and the Canada Pension Plan Investment Board. Read more.

•  ZAGG (Nasdaq: ZAGG) has agreed to acquire Mophie, a Tustin, Calif.-based maker of mobile accessories, for $100 million up-front and an undisclosed amount of possible earn-outs. Mophie shareholders include Beringea. Read more.

OTHER DEALS

•  ChemChina has offered to acquire Swiss agricultural chemical and seed maker Syngenta (SWX: SYNN) for around $43 billion. It would be the largest-ever takeover by a Chinese company of a foreign target. Read more.

•  Lowe’s Companies (NYSE: LOW) has agreed to acquire Canadian rival Rona Inc. (TSX: RON) for C$3.2 billion in cash. Read more.

•  Starboard Value has acquired a 6.7% stake in chip-maker Marvell Technology (Nasdaq: MRVL), which has a current market cap of around $4.5 billion. Read more.

FIRMS & FUNDS

•  The Catalyst CEL Fund, a partnership between Catalyst Private Equity (Israel) and China Everbright (Hong Kong), has closed with more than $200 million in capital commitments. The fund will back growth-stage companies focused on Chinese markets. Read more.

Moving In, On & Up

•  Jeff Cleveland has joined D.A. Davidson & Co. as a Seattle-based managing director in the investment bank’s consumer and retail group. He previously was a founding member of Harris Williams & Co.’s Minneapolis office. www.davidsoncompanies.com

•  Sonia Nagar has joined Pritzker Group Venture Capital as a vice president. She previously was VP of product and head of mobile apps for RetailMeNot (Nasdaq: SALE). www.pritzkergroup.com

•  Bob Long, former CEO of Conversus Capital and Oak Hill Advisors, has joined Star Mountain Capital as president. www.starmountaincapital.com

•  Alexander Taussig has joined Lightspeed Venture Partners as a partner. He previously spent more than six years with Highland Capital Partners. www.lightspeedvp.com

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