Greetings from New York City, where I’m in town for a variety of conferences and meetings. A few quick notes before heading over to Fortune HQ for one of the latter:
• What Mary Jo worry about Congress? The SEC is around two years past its Congressionally-mandated deadline for finalizing equity crowd-funding rules, and recently announced another delay that will take us into late 2015 (with any actual rules unlikely to take effect until January 2016). Following SEC chair Mary Jo White’s speech yesterday at the Dealbook Conference, I asked her if the agency feels it has any drop-dead date for finalizing the rules. She said no, adding that “we’ve gotten a lot of comments and our staff is actively working through them.”
• Shareholder activism: Interesting comments yesterday from BlackRock boss Larry Fink at the Dealbook Conference, in which he argued that activist investors are increasing U.S. income inequality. Fink’s basic case is that activists compel boards to increase share buybacks and dividends, both via direct pressure (as a new shareholder) or just as a looming specter (i.e., defensive measures by boards), thus decreasing the amount of corporate investment. Less investment=fewer new jobs.
Fink’s comments followed an interview with activist Paul Singer, who took issue with the popular perception that he and his cohort are short-termists, citing studies that show how activists tend to hold onto equity positions longer than do other institutional investors. What I wonder here is if the activist hold-times are artificially elongated because it takes a while for companies resolve an activist’s demands (either affirmatively or negatively.
• Speaking of activists: When I ask big buyout execs about the recent dearth of large take-privates, they all cite the same two factors: (1) Sky-high public market valuations, and (2) The rise of activists, who often are faster to move on companies that otherwise would be sensible LBO targets. The obvious question, therefore, is if PE firms will start aping the activists. Not in terms of antagonism, but in terms of entry strategy — buying up small positions on the open market in order to gain a foothold/influence that possibly could lead to an eventual takeover.
Everyone I’ve spoken with says they’ve at least discussed this concept, but with varying degrees of internal interest. The big problem, some say, is that the LBO firms would have little leverage without a hammer — and none of today’s LBO firms want to be seen as even potentially-hostile.
• Future tech: GM Mary Barra said at the Dealbook Conference that “drivers” of self-driving cars will still need to remain alert (i.e., no napping), and that GM is developing methods to make sure that happens. She didn’t provide specifics, but the possibilities seem endless. And, unless I’m thinking about it wrong, a bit unpleasant.
• Uni/Undercorn update: New Relic and Hortonworks both priced IPOs last night. New Relic passed the $1 billion initial market cap mark, while Hortonworks fell well short (despite pricing above its proposed range).
• Feedback: A bunch of emails related to yesterday’s column on why Warren Buffett should buy Uber, and little of it was complimentary. Here was a succinct example from Larry: “Did Fortune’s editors hold a contest where the person who comes up with the dumbest idea gets to write about it?”
• Have a great weekend: Go Pats!
THE BIG DEAL
• Uber reportedly has raised around $600 million in new equity funding from Chinese Internet search giant Baidu.com (Nasdaq: BIDU), to close out a $1.8 billion funding round that was first disclosed last week. The deal was done at a valuation of around $40 billion. Read more.
VENTURE CAPITAL DEALS
• Woven Digital, a Culver City, Calif.-based publisher of pop culture news and entertainment sites like UPROXX and Brobible, has raised $18 million in Series A funding. Institutional Venture Partners led the round, and was joined by Advancit Capital, The San Francisco 49ers, United Talent Agency and individual angels like senior partners from entertainment law firm Ziffren Brittenhanm, Buddy Media co-founder Mike Lazerow, MySpace co-founder Chris DeWolfe and former NBA players Baron Davis and Jermaine O’Neal. www.woven.com
• CellTrust Corp., a Scottsdale, Ariz.-based provider of collaborative mobile communications solutions with tracing and archiving capabilities, has raised $10.5 million in Series A funding from Kayne Partners. www.celltrust.com
• Kinsa, a New York-based maker of a smartphone-connected thermometer, has raised $9.6 million in Series A funding. Backers include Kleiner Perkins Caufield & Byers and FirstMark Capital. www.kinsahealth.com
• VideoAmp, a Santa Monica, Calif.-based programmatic video advertising startup, has raised $2.2 million in new VC funding. Backers include Anthem Venture Partners, Simon Equity Partners, Third Wave Capital, Wavemaker Partners and ZenShin Capital. www.videoamp.com
• Framed Data, a San Francisco-based provider of marketing analytics that leverage machine learning, has raised $2 million in seed funding. Backers include Google Ventures, Innovation Works, Jotter, NYU Innovation Venture Fund and individual angels. www.framed.io
PRIVATE EQUITY DEALS
• Altamont Capital Partners has agreed to sponsor a majority recap of Fox Head Inc., a Morgan Hill, Calif.–based maker of motocross equipment, apparel and accessories. No financial terms were disclosed. www.foxhead.com
• GTCR and Adams Outdoor Advertising (a portfolio company of Metalmark Capital) are in talks for a joint bid to acquire Fairway Outdoor Advertising LLC, a Duncan, S.C.–based outdoor advertising company, from Acon Investments and MidOcean Partners, according to Reuters. The deal could be valued at around $550 million. Read more.
• Hony Capital and Goldman Sachs have agreed to lead investments in two subsidiaries of listed Chinese IT services provider of Neusoft Corp. One deal involves Goldman, Hony, Canada Pension Plan Investment Board, FrontLine BioVentures and other investors putting around $441 million into Neusoft Medical Systems, while the other includes just Goldman and Hony investing $170 million into Neusoft Xikang. Following the deals, Neusoft will hold a 33.35% equity stake in Neusoft Medical Systems and a 32.81% stake in Neusoft Xikang. Read more.
• Meridian Medical Management, a Wilbraham, N.Y.-based portfolio company of Gores Group, has acquired Origin Healthcare Solutions, a Chicago–based provider of revenue cycle management and analytics solutions. No financial terms were disclosed. www.originhs.com
• Pacific Equity Partners has agreed to sell Australian cinema chain The Hoyts Group to China’s ID Leisure International Capital for around A$900 million, according to Reuters. Read more.
• Thomas H. Lee Partners is in talks to acquire Curo Health Services, a Mooresville, N.C.-based hospice car company, from GTCR for more than $700 million (including debt), according to Reuters. Read more.
• Avolon Holdings Ltd., an Ireland-based aircraft leasing company, raised $273 million in its IPO. The company priced 13.6 million shares at $20 per share (below $21-$23 range), for an initial market cap of approximately $1.62 billion. It will trade on the NYSE under ticker symbol AVOL, while J.P. Morgan, Morgan Stanley and Citigroup served as lead underwriters. Shareholders include Cinven, CVC Capital Partners and Oak Hill Advisors. ww.avolon.aero
• Civitas Therapeutics, a Chelsea, Mass.-based developer of a Parkinson’s disease treatment that leverages a respiratory delivery platform, has withdrawn its IPO registration. The company agreed in September to be acquired for $525 million in cash by Acorda Therapeutics Inc. (Nasdaq: ACOR). www.civitastherapeutics.com
• Hortonworks, a Palo Alto, Calif.-based open-source platform for storing and analyzing big data, raised $100 million in its IPO. The company priced 6.25 million shares at $16 per share (above $12-$14 range), for an initial market cap of approximately $666 million. It plans to trade on the Nasdaq under ticker symbol HDP, while Goldman Sachs was listed as left-lead underwriter. Shareholders include Yahoo (19.6% pre-IPO stake), Benchmark (18.7%), Index Ventures, Teradata and Hewlett-Packard. www.hortonworks.com
• Metaldyne Performance Group Inc., a Plymouth, Minn.-based automotive powertrain components maker, raised $150 million in its IPO. It priced 10 million shares at $15 per share, compared to earlier plans to price 15.38 million shares at between $18 and $21 per share. The company’s initial market cap is around $1 billion, and it will trade on the NYSE ticker symbol MPG. Goldman Sachs, BofA Merrill Lynch and Deutsche Bank served as lead underwriters. American Securities acquired Metaldyne in late 2012. www.metaldyne.com
• Momo Inc., a Chinese mobile-based social networking platform, raised $216 million in its IPO. The company priced 16 millionshares at $13.50 per share (middle of range), for an fully-diluted market cap of $2.7 billion. It will trade on the Nasdaq under ticker symbol MOMO, while Morgan Stanley was listed as left-lead underwriter. It reports an $8.2 million net loss on $13.89 million in revenue for the first six months of 2014. Shareholders include Alibaba (20.7% pre-IPO stake), Matrix Partners China (19.9%) and Sequoia Capital (5.6%). www.immomo.com
• New Relic, a San Francisco-based provider of application performance management solutions for the enterprise, raised $115 million in its IPO. The company priced 5 million shares at $23 per share (above upwardly-revised $20-$22 range), for an initial market cap of approximately $1.06 billion. It will trade on the NYSE under ticker symbol NEWR, while Morgan Stanley and J.P. Morgan served as lead underwriters. The company reports a net loss of $19.4 million on $39 million in revenue for the six months of 2014 ending Sept. 30, compared to an $18.5 million net loss on nearly $22 million in revenue during the year-earlier period. New Relic had raised around $270 million in VC funding from Benchmark (22% pre-IPO stakjje), Trinity Ventures (13.6%), Insight Venture Partners (5.6%), Tenaya Capital (4.9%), BlackRock, Passport Capital, T. Rowe Price, Dragoneer Investment Group and Allen & Company. www.newrelic.com
• Workiva LLC, an Ames, Iowa-based provider of cloud-based business reporting solutions, raised $101 million in its IPO. The company priced 7.2 million shares at $14 per share (middle of $13-$15 range), for an initial market cap of approximately $553 million. It will trade on the NYSE under ticker symbol WK, while Morgan Stanley and Credit Suisse served as lead underwriters. Workiva reports a $28 million net loss on $82.5 million in revenue for the first nine months of 2014, compared to a $22.5 million net loss on $61.6 million in revenue for the year-earlier period. Investors include Bluestem Capital. www.workiva.com
• KKR and TA Associates have agreed to sell Fotolia, a global marketplace for royalty-free images, to Adobe (Nasdaq: ADBE) for $800 million. www.fotolia.com
• Permira is planning to cut its stake in German fashion retailer Hugo Boss (DB: BOSS) from 39% to 32% via stock sales on the public market. UBS is managing the sales. Read more.
• Platinum Equity has agreed to sell Fishing Holdings LLC, a Flippin, Ark.-based maker of fishing boats, to Bass Pro Group LLC. No financial terms were disclosed. www.basspro.com
• DreamWorks Animation (Nasdaq: DWA) has sold a 25% stake in teen-focused YouTube network AwesomenessTV to Hearst for $81.25 million. DreamWorks had paid just $33 million to buy the entire company last year. www.awesomenesstvnetwork.com
• Royal Dutch Shell PLC (Amsterdam: RDSA) is seeking a buyer for its 75% stake in Chinese oil lubricants business Tongyi for between $350 million and $500 million, according to the WSJ. Read more.
• U.S. Concrete Inc. (Nasdaq: USCR) has acquired the ready-mixed concrete assets and property of Staten Island, N.Y.-based Diamond Concrete Inc. No financial terms were disclosed. www.us-concrete.com
FIRMS & FUNDS
• No firm or fund news this morning.
MOVING IN, UP, ON & OUT
• Nick Hutt has been named CEO of Russian investment firm VTB Capital, after having served as intrim CEO since the July departure of Atanas Bostandjiev. Hutt is expected to remain in July. Read more
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