Random Ramblings
No real column this morning, as I spent most of yesterday in meetings and in my car.
But if you're looking for something of interest, check out this Libby Lewis piece about a recent Massachusetts court ruling that found private equity firm Sun Capital Partners is liable for the pension fund debt of a portfolio company that went bankrupt. Moreover, the liability holds even though Sun had originally structured the deal as a buyout by two of its funds, after which neither fund had more than an 80% stake in the underlying business. This is a pretty big deal in the private equity firm, and could affect the types of deals (and the terms) of leveraged buyouts going forward.
I'm also trying to mentally process a new Legg Mason survey of those with at least $250,ooo in investible assets (i.e., excluding real estate), which found that a majority believe the American Dream is no longer attainable. Broken down even further, just 36% of millionaires surveyed by Legg Mason "strongly agree" that they are living the American Dream.
If you fall into this group -- affluent person who doesn't believe he or she has attained the American Dream -- please send me a note of explanation. Because, from where I sit, it reads ridiculous.
Anyway, we'll return to our regularly-scheduled ramblings on Monday. Plenty of news below to digest, including the first real tech IPO of 2016. Have a great weekend...
THE BIG DEAL
• SecureWorks, an Atlanta-based cybersecurity unit of Dell Inc., raised $112 million in its IPO. The company priced 8 million shares at $14 per share, below initial plans to offer 9 million shares at between $15.50 and $17.50 per share.
It has an initial market cap of around $1.14 billion, and will trade on the Nasdaq under ticker symbol SCWX. BofA Merrill Lynch was listed as left lead underwriter. SecureWorks reports a $72 million net loss on around $339.5 million in revenue for the year ending January 30, 2016. Read more.
VENTURE CAPITAL DEALS
• Hua Medicine, a Shanghai-based developer of therapeutics for diabetes and CNS disorders, has raised $50 million in Series C funding. Harvest Investments led the round, and was joined by return backers Frontline BioVentures, Arch Venture Partners, Venrock, Fidelity, WuXi Ventures, SAIL, Ally Bridge Group and TF Capital. www.huamedicine.com
• Medium, a San Francisco-based online content publishing platform, has raised $50 million in Series C funding led by Spark Capital. The company also announced that Ben Horowitz (a partner with existing Medium backer Andreessen Horowitz) and Judy Estrin (JLabs CEO) are joining its board, while David Sze (a partner with Medium backer Greylock) will be stepping down (fellow Greylock partner Josh Elman remains a director). Read more.
• TheRealReal, a San Francisco-based online luxury consignment shop for men and women, has raised $40 million in Series E funding. Greenspring Associates led the round, and was joined by Broadway Angels, NextEquity Partners, Springboard Fund and return backers Canaan Partners, e.ventures, Greycroft Partners, InterWest Partners, DBL Partners, and Industry Ventures. The company has now raised a total of $123 million. www.therealreal.com
• Kueski, an online provider of micro-loans in Mexico, has raised $10 million in new VC funding. The company also secured $25 million in new debt funding. Backers include Richmond Global Ventures, Rise Capital, CrunchFund, Variv Capital, Victory Park Capital, Angel Ventures Mexico, Core Ventures Group and Auria Capital. www.kueski.com
• Preempt Security, a San Francisco-based enterprise cybersecurity startup, has raised $8 million in Series A funding. General Catalyst led the round, and was joined by Paul Sagan and Trusteer founders Mickey Boodaei and Rakesh Loonkar. www.preempt.com
• Armada Interactive, a Finland-based mobile gaming startup, has raised $3 million in seed funding. Intel Capital led the round, and was joined by Index Ventures, PROfounders Capital, Backed, Next Games, Reaktor Ventures, Sisu Game Ventures, Chris Lee, Reynir Hardarson and Ben Feder. www.armadainteractive.com
• Brayola, a new online service that helps women find bras that fit, has raised $2.5 million in Series A funding from HDS Capital and FirstTime Capital. Read more.
• Chameleon, a San Francisco-based user onboarding platform, has raised $1.9 million in seed funding led by True Ventures. www.trychameleon.com
• Clear Guide Medical, a Baltimore-based developer of a CT-ultrasound fusion and image guidance system for minimally-invasive surgical procedures, has raised $1.5 million in Series A funding led by Wildermuth Advisory LLC. Read more.
PRIVATE EQUITY DEALS
• The Blackstone Group is considering a takeover offer for Canadian pharma company Concordia Healthcare (TSX: CXR), according to Bloomberg. The news caused Concordia shares to jump 28%, giving it a current valuation of around US$1.6 billion. Read more.
• Fexy Media, a Mercer Island, Wash.-based portfolio company of Tritium Partners, has acquired Simply Recipes, a Carmichael, Calif.-based food and recipe blog founded by Elise Bauer. No financial terms were disclosed. www.simplyrecipes.com
• PayScale, a Seattle-based compensation software company owned by Warburg Pincus, has acquired MarketPay, a Denver-based provider of tech-enabled services for managing multiple sources of compensation survey data. No financial terms were disclosed. www.payscale.com
• Salt Creek Capital has acquired Sperry & Rice, a Brookville, Ind.-based manufacturer of specialized rubber components for the appliance, automotive, and heavy truck and bus industries. No financial terms were disclosed. www.sperryrice.com
IPOs
• Medpace Inc., a Cincinnati-based pharma contract research organization owned by Cinven, has filed confidential IPO papers for an offering that could value the company at more than $1 billion (including debt), according to Reuters. Read more.
• Permira is considering an IPO for Japanese sushi chain operator Akindo Sushiro Co., according to Reuters. The float could value Akindo at around $1.4 billion. Read more.
EXITS
• Allergan PLC (NYSE: AGN) has acquired Topokine Therapeutics, a Boston-based developer of topical medicines for fat reduction, for $85 million. Sellers include Schooner Capital. www.allergan.com
• KKR has short-listed several bidders in the auction for WMF, a German coffee machine maker that could be valued at more than $1.7 billion, according to Reuters. Among the active suitors are China’s Joyoung Co. and KingClean Electric Co., plus Sweden’s Electrolux, Italy’s De Longhi and France-based Groupe SEB. Read more.
OTHER DEALS
• Darty (LSE: DRTY), a French electronics and appliances retailer, has received takeover offers from Fnac (Paris: FNAC) and the French unit of South Africa’s Steinhoff International Holdings (JSE: SNH). Darty is currently valued at around $1.2 billion. Read more.
FIRMS & FUNDS
• Industrial Group Partners, a San Francisco-based private equity firm focused on the lower middle markets, is raising upwards of $800 million for its fifth fund, according to a regulatory filing. Park Hill Group is serving as placement agent. www.igpequity.com
• Peppertree Capital, a Chagrin Falls-based growth equity firm, is raising its sixth fund, according to a regulatory filing. www.peppertreecapital.com
MOVING IN, ON & UP
• Padraic McConville has joined KinderCare Education as EVP of corporate development. He previously was with Partners Group as an SVP of private equity direct investing. www.kindercare.com
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