Random Ramblings
21st Century Fox yesterday announced that it has withdrawn its $85 billion takeover offer for Time Warner , instead launching a $6 billion stock buyback. Seems that Rupert Murdoch wasn’t too pleased with how his company’s stock price had slumped since the deal was first announced, while Time Warner’s shares had climbed. Three immediate thoughts:
1. This is not the end: Moguls like Rupert Murdoch do not base massive strategic decisions on short-term stock fluctuations. There is nothing in Fox’s statement that precludes Murdoch from making a future bid, at whatever price. Don’t be surprised if this is just a negotiation ploy.
2. Time Warner must be spooked: Time Warner shares have cratered on the news, down more than 12% in pre-market trading (as of this writing) to just $74.86 per share. That’s more than $9 billion in evaporated market cap. It’s still above the $71 or so that it was trading at prior to the Fox bid leaking, but this is a giant message to the Time Warner board that investors were bidding up based on the takeover offer, not the underlying story. Fox stock, for what it’s worth, is going in the opposite direction on the news.
3. He can’t lose: If Time Warner CEO Jeff Bewkes really is playing poker with Rupert Murdoch, he is in a pretty sweet position. After all, who else can get snookered at the table and walk away with nearly $80 million?
• Secondary shuffle: Bloomberg is reporting that Ardian (f.k.a. AXA Private Equity) is in talks to acquire more than $2 billion worth of PE fund stakes in a secondary transaction from the Abu Dhabi Investment Authority. And it adds that while ADIA had hired Cogent Partners to advise on the disposal, “Ardian made a bid on the portfolio before ADIA could start a sales process.”
So, how does Ardian know to bid on something that’s not yet for sale? Perhaps because ADIA is a limited partner in Ardian funds. Or perhaps because Ardian’s former chief operating officer now works at ADIA. Either way, this would seem to spark several conflict of interest questions. On the one hand, perhaps Ardian would offer that it’s getting a great deal, because the portfolio didn’t go to open market. On the other, might smaller Ardian LPs not be concerned that their GP is doing a solid for one of its largest LPs? Awaiting comment from Ardian, although it’s unlikely given that the deal has not yet been announced.
• Bruce bounce: Illinois gubernatorial candidate Bruce Rauner is up five points in his race against current Illinois Gov. Pat Quinn, according to a new poll conducted by CBS News, The NY Times and YouGov. This is the first-ever campaign for Rauner, a former partner with Chicago-based private equity firm GTCR (which he formally left a few years back).
• Millions for $1 gas? Siluria Technologies, a San Francisco-based developer of technologies to make gasoline and ethylene from methane, has raised just over $30 million of a $44 million Series D round, according to a regulatory filing. If the company can produce at scale – it claims strong results from its pilot plant – then we could be talking about natural gas-based fuel at the local service station, rather than petroleum-based fuel. MIT Tech Review had a good explanatory piece on Siluria earlier this year.
Saudi Aramco Energy Ventures appears to have led the round, since Houston-based partner Mike Maloof is the only new board member listed. The company previously raised more than $60 million from such firms as Bright Capital, Vulcan Capital, ARCH Venture Partners, The Wellcome Trust, Alloy Ventures, Kleiner Perkins Caufield and Byers, Lux Capital, Altitude Life Science Ventures and Presidio Ventures. Siluria declined to comment.
• Felicis Ventures announced that it has closed its fourth fund with $96 million, and also that it will vote its shares with its founders for all future deals (except in instances of fraud). My gut reaction is that this may be taking 'entrepreneur-friendly' a step too far -- or at least at the expense of fiduciary duty to LPs, in select cases -- but will reserve final judgment until I speak with some Felicis folks. More on this tomorrow.
• Sheet expansion: Last month we launched Broadsheet, a new daily email focused on the world's most powerful women and those who aspire to join them. It's going great, and you can sign up by going here.
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THE BIG DEAL
• Walgreen (NYSE: WAG) has agreed to acquire the 55% stake it does not already own in UK drugstore chain Alliance Boots for $15.3 billion, but has abandoned its plans to relocate Walgreen headquarters overseas. Sellers include Alliance Boots chairman Stefano Pessina and private equity firm KKR.
The move comes one day after reports that the Obama Administration is considering an executive action to stem the tide of so-called ‘tax inversion’ deals, including a clause that would apply to announced but still-uncompleted transactions. Had Deerfield, Ill.-based Walgreen proceeded with a tax inversion strategy – and were U.S. law unchanged – the company might have saved around $4 billion in taxes over the first five years. Read more.
VENTURE CAPITAL DEALS
• Druva, a Sunnyvale, Calif.-based provider of data protection and governance solutions for enterprise devices, has raised $25 million in Series D funding. Sequoia Capital led the round, and was joined by fellow return backers Nexus Venture Partners and Tenaya Capital. The company previously raised $42 million. www.druva.com
• Doctor on Demand, a San Francisco-based online platform for connecting patients with doctors, has raised $21 million in Series A funding from Venrock, Shasta Ventures and Richard Branson. Seed backers had included Venrock and Shasta, plus Andreessen Horowitz and Google Ventures. www.doctorsondemand.com
• InVision, a New York-based cloud collaboration and workflow platform for the product design process, has raised $21 million in Series B funding. Tiger Global Management led the round, and was joined by return backers like FirstMark Capital. www.invisionapp.com
• GliaCure Inc., a Boston-based developer of non-neuronal therapies for neurological and neuropsychiatric disorders, has raised $5.8 million in Series B funding. No investor information was disclosed. www.gliacure.com
• Spoga, a South Korea-based mobile loyalty platform,, has raised $3.9 million in new VC funding from Daesung Private Equity and Bokwang Investments. www.spoga.com
• Rapt Media, a Boulder, Colo.-based provider of interactive video creation solutions, has raised $3.1 million in new VC funding led by Boulder Ventures. www.raptmedia.com
• OpenSignal, a San Francisco-based database of available wireless networks, has raised $4 million in Series A funding. Qualcomm Ventures led the round, and was joined by OATV and Passion Capital. www.opensignal.com
• Splice Machine, a San Francisco-based provider of an SQL-on-Hadoop database for big data applications, has raised $3 million in new Series B funding from Correlation Ventures, Roger Sippl and Roger Bamford. The total round now stands at $18 million, including prior commitments from Interwest Partners and Mohr Davidow Ventures. www.splicemachine.com
• Drop Messages, a San Francisco-based provider of location-based social messaging solutions, has raised $1.25 million in VC funding. Atlas Venture and Spark Capital led the round, and were joined by individual angels like Tim Draper. www.dropmessages.com
PRIVATE EQUITY DEALS
• Calera Capital has acquired United Site Services, a Westborough, Mass.–based provider of on-site services like portable sanitation and temporary fencing, from GSO Capital Partners and Angelo Gordon & Co. No financial terms were disclosed. Harris Williams & Co. managed the process. www.unitedsiteservices.com
• Express Medical Transporters, a St. Louis-based provider of non-emergency medical and student transportation, has raised an undisclosed amount of equity and subordinated debt funding from Mosaic Capital Partners and Pine Street Capital Partners. www.emtusa.net
• IsoPlexis Corp., a New Haven, Conn.-based provider of single cell immunoassay software for immune and cancer cells, has raised an undisclosed amount of growth equity funding led by Spring Mountain Capital. www.isoplexis.com
• Landmark Aviation, a Houston, Texas-based provider of fueling and ground support services to the general and commercial aviation markets, has completed its previously-announced acquisition of Ross Aviation, a Denver-based network of fixed based operations, from Centre Partners. No financial terms were disclosed. Landmark Aviation is a portfolio company of The Carlyle Group. www.landmarkaviation.com
• Long Ridge Equity Partners has sponsored a minority recapitalization of Portware, a New York–based provider of multi-asset trade automation solutions powered by artificial intelligence. www.portware.com
• Partners Group, Duke Street and Tikehau have partnered on a £375 million acquisition of Voyage Care, a UK-based provider of specialist residential services and supported living for people with learning disabilities, autistic spectrum disorders, acquired brain injuries or other complex needs. The seller was HgCapital. www.voyagecare.com
IPOs
• Auris Medical Holding, a Swiss pharma company focused on inner ear disorders, raised $56 million in its IPO. The company priced 9.4 million shares at $6 per share (per its downwardly-revised target), for an initial market cap of approximately $169 million. It will trade on the Nasdaq under ticker symbol EARS, while Jefferies and Leerink Partners served as lead underwriters. Shareholders in the pre-revenue company include Sofinnova Venture Partners (19.3% pre-IPO stake), Sofinnova Capital (18.6%), Adamant Global Generika Funds (11.4%) and Idinvest Partners (9.1%). www.aurismedical.com
• Aina Le'a Inc., a Hawaii-based real estate development firm, has withdrawn registration for a $37.5 million IPO that was originally filed in July 2012. It requested the withdrawal “because of the length of time from the Company’s initial filing to complete the audit process.” www.ainaleaasia.com
EXITS
• Tapjoy, a San Francisco-based provider of monetization, distribution and publishing services for social and mobile applications, has acquired 5Rocks, a Korean “lifetime value” maximization, analytics and marketing automation platform. No financial terms were disclosed. Taojoy has raised VC funding from J.P. Morgan, Rho Ventures, InterWest Partners, North Bridge Venture Partners and D. E. Shaw Ventures. 5Rocks backers included Global Brain Corp., KDDI Open Innovation Fund, SparkLabs and WING Fund. www.tapjoy.com
OTHER DEALS
• Dollar General (NYSE: DG) is considering a rival takeover bid for retailer Family Dollar (NYSE: FDO), which already has agreed to be acquired for $8.5 billion by Dollar Tree (Nasdaq: DLTR), according to Bloomberg. Read more.
• T-Mobile US (NYSE: TMUS) is planning to reject a $15 billion all-cash takeover offer from Iliad (Paris: ILD), according to Bloomberg. In related news, Sprint has abandoned its courtship of T-Mobile US. Read more.
• Siemens AG has agreed to sell its health IT business unit (Siemens Health Services) to Cerner Corp. (Nasdaq: CERB) for $1.3 billion in cash. www.siemens.com
• SurveyMonkey has acquired Fluidware, a Canadian provider of online survey and application review tools. No financial terms were disclosed. www.surveymonkey.com
FIRMS & FUNDS
• Felicis Ventures, a Palo Alto, Calif.-based venture capital firm, has closed its fourth fund with $96 million in capital commitments. www.felicis.com
• Northleaf Capital Partners has held a C$233.5 million second close on a new venture capital fund-of-funds, which is the first f-o-f to be established under the Canadian government’s Venture Capital Action Plan (VCAP). www.northleafcapital.com
• Goldman Sachs Asset Management and DB Private Equity are in talks to acquire NBGI Private Equity, the private equity unit of National Bank of Greece, according to Bloomberg. The deal could be valued at around £300 million. Read more.
• Summation Health Ventures has raised $20 million for its debut fund, according to a regulatory filing. The Long Beach, Calif.-based firm is led by existing executives at MemorialCare Health System and Cedars-Sinai Health System. www.shv.io
MOVING IN, UP, ON & OUT
• Ares Capital Corp. (Nasdaq: ARCC) has named Michael Arougheti as co-chair of its board of directors, joining current chair Bennett Rosenthal. Arougheti has been on the Ares board since 2009 and has served as CEO since May 2013. www.arescapitalcorp.com
• John Capetta has joined law firm Martin LLP as head of its private equity practice group. He previously was chair of private equity with Kelley Drye & Warren LLP. www.martinllp.com
ts_bullet_primary] Mark Hanson has agreed to join Evercore as a New York-based senior managing director in the firm’s healthcare group. He previously was a managing director of healthcare investment banking for Barclays. www.evercore.com
• Dev Ittycheria is stepping down as a managing director of OpenView Ventures Partners, in order to become president and CEO of New York-based NoSQL database company MongoDB. He joined OpenView less than one year ago, before which he was a venture partner with Greylock and co-founder and CEO of BladeLogic (acquired by BMC Software). www.mongodb.com
