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Term Sheet — Thursday, June 10

June 9, 2016, 2:09 PM UTC

Random Ramblings

Greetings from the home office, where it's good to be back in the saddle after yesterday's unexpected interruption. Some notes to kick off your Thursday:

Price Talk: There has been some speculation that the Dell valuation ruling will put a chill on public-to-private buyouts, particularly ones that include members of company management on the buy-side. Sorry, but I just don't see it.

For starters, let me express clearly that I believe the ruling to be absurd. Not just the general notion of a judge being able to effectively change the deal price of a competitive process with no funding of wrongdoing, but also the idea that 2013 Dell could only be fairly valued via a discounted cash flow model. Remember, a lot of prospective bidders viewed Dell as a falling knife whose business was severely atrophying. It does not appear that Delaware took those more subjective concerns into account, nor the associated risk assumed by Michael Dell and Silver Lake. Also not seemingly addressed by the court were broader value questions of whether Michael Dell would stick around were his group to have lost, let alone if the company were somehow forced to remain public (or with a public stub).

More importantly, however, the actual cash being paid out is relatively small. Thanks in part to T. Rowe Price's third-party fat finger, the total payout comes to less than $25 million. Michael Dell could personally write that check without losing a minute's sleep. There might be some worries that the Dell ruling will encourage more appraisal lawsuits ― got to think it might come with Dell/EMC ― but even successful efforts should remain relatively small given that: (a) Not too many shareholders can participate, or else the deal won't pass in the first place, and (b) There remains a risk of losing such suits, and having court find that the deal was actually overpriced (yes, this has happened). In such cases, it might be better to provide investors with an underhwelming but guaranteed return than a smaller one than everyone else got.

Hey, there's the summit: Sherpa Capital, the San Francisco-based VC firm led by Shervin Pishevar and Scott Stanford, has raised $470 million for a pair of new funds. The first $172 million is for Sherpa Ventures II, which will focus on early-stage opportunities (including follow-ons through Series D). The remaining $298 million is for Sherpa Everest, a mid-stage fund that could eventually be larger due to expected LP co-invest opportunities.

The firm had originally raised $154 million for its debut fund, which encompasses both early and later-stage opportunities. Portfolio companies include Uber, Shyp, Airbnb, SpaceX and Hyperloop One (where Pishevar is co-founder and executive chairman). The new VC fund already has five portfolio companies, including PillPack, while Everest includes stakes in such companies as Uber (Series E), Ipsy, Slack and Rent the Runway.

Fortune has obtained certain documents related to the fundraise, which include some historical performance data. They report that Pishevar has generated (on paper) a 72.4x MoM on his $66.2 million in VC investments (methinks that’s largely thanks to Uber), while Stanford has (also on paper) generated a 2.78x MoM on his $1.6 billion in invested capital (remember, he used to be with Goldman Sachs, so the dollar amount is higher). Pishevar has one VC exit, while Stanford has five. No comment from Sherpa on any of that, natch…

That's so Mavens: Just before I sent out Term Sheet this morning, CNBC reported that Yahoo has received multiple bids of $5 billion or more for its core Internet business. Verizon reportedly came in at just around $3.5 billion, suggesting that private equity might now be in the driver's seat...

Qualcomm Ventures shakeout (cont.): Money Hassid has quietly stepped down as an Israel-based managing director with Qualcomm Ventures, after nearly a four-year run. His deals had included Wilocity (acquired by Qualcomm) and Ravello Systems (acquired by Oracle). No word yet on his future plans.

It's not me, it's you: Yesterday I conducted a brief email interview with Mark Cuban, asking him about his Twitter trolling of Donald Trump, and also what he believes are the country's most pressing economic issues. It will be posted later this morning, but here's a quick preview: Trump himself has reached out to Cuban in recent weeks, to ask why the Dallas Mavericks owner has turned so negative toward his fellow (maybe) billionaire. Unfortunately, Cuban declined to share his reply to Trump.


 Dong Energy AS, a Danish offshore wind power operator, raised around $2.6 billion in a Copenhagen IPO, making it the year’s largest European initial public offering to date. The deal gives Dong an initial market cap of around $15 billion. Shareholders include Goldman Sachs, The ATP Group and Pfa Pension. Read more.


 Liberty SBF, a New York-based commercial real estate lender, has raised $75 million in Series B funding co-led by Exigent Capital and Mainline Investment Partners. The company also said that it has expanded its credit facilities with Capital One Bank.

 Tradeshift, a San Francisco-based online procurement and expensing management platform, has raised $75 million in Series D funding. Data Collective led the round, and was joined by American Express Ventures, CreditEase, HSBC, Pavilion Capital and return backer Notion Capital. Read more.

 SundaySky, a New York-based provider of personalized video engagement for brands, has raised $30 million in Series D funding. Viola Private Equity led the round, and was joined by NTT DoCoMo and return backers Carmel Ventures, Globespan Capital Partners, Norwest Venture Partners and Comcast Ventures.

 Omicia Inc., an Oakland, Calif.-based provider of clinical genome interpretation and reporting software, has raised $23 million in Series B funding. UPMC Enterprises, Roche Venture Fund, LDV Partners and Ping An Ventures were joined by return backers Artis Ventures, Acadia Woods Partners and Buchanan Investments.

 Aktana, a San Francisco-based provider of decision support services for life sciences companies, has raised up to $17.5 million in new VC funding. Safeguard Scientifics led the round, and was joined by return backer Starfish Ventures.

 Amplitude, a San Francisco-based behavior analytics platform for mobile and web, has raised $15 million in Series B funding. Battery Ventures led the round, and was joined by return backer Benchmark.

 When I Work, a St. Paul, Minn.-based tool for scheduling, tracking time and communicating with hourly employees, has raised $15 million in Series B funding. Drive Capital led the round, and was joined by Arthur Ventures and High Alpha.

 Embotics, an Ottawa-based provider of multi-cloud management software for public and private environments, has raised US$12.1 million in growth equity funding from Arrowroot Capital.

 RetraceHealth, a Minneapolis-based provider of primary care through in-home and video visits, has raised $7 million in new Series A funding from return backers McKesson Ventures, Blue Cross and Blue Shield of Minnesota, and HealthEast Care System.

 TravelPerk, a Barcelona-based business travel booking platform, has raised $7 million in Series A funding. Spark Capital led the round, and was joined by Sunstone Capital and return backer LocalGlobe.

 Freenome, a liquid biopsy diagnosis platform, has raised $5.5 million in seed funding. Andreessen Horowitz led the round, and was joined by Founders Fund, Data Collective and Third Kind Venture Capital. Read more.

 Aquicore, a Washington, D.C.-based provider of real-time data collection and analytics for commercial real estate, has raised $5 million in Series A funding. Kiddar Capital led the round, and was joined by Navitas Capital.

 Gamer Sensei, a Boston-based coaching platform for e-sports participants, has raised $2.3 million in seed funding. Accomplice and Boston Seed Capital co-led the deal, and were joined by Sigma Prime, FJ Labs and Corigin Ventures.

 Intersect, a provider of user behavior analytics, has raised an undisclosed amount of new VC funding from In-Q-Tel. Read more.


 Alita Care LLC, a portfolio company of Kohlberg & Co., has acquired The Meadows Behavioral Healthcare, a Wickenburg, Ariz.-based provider of treatment for people suffering from trauma, eating disorders and addictions. No financial terms were disclosed.

 Arcus Hunting, an archery and bowhunting company owned by Bregal Partners, has acquired Trophy Taker Inc., a Plains, Mont.-based provider of arrow rests, broadheads and related accessories. No financial terms were disclosed.

 Confie Seguros, a personal insurance company focused on Hispanic consumers, has acquired ExpressLink Inc., a provider of auto dealer point-of-sale insurance and related products. No financial terms were disclosed. Confie Seguros is a portfolio company of ABRY

 Fisher Unitech, a Troy, Mich.-based portfolio company of The Riverside Company, has acquired Prism Engineering, a Horsham, Penn.-based reseller of CAD software, CAM software and 3D printers. No financial terms were disclosed.

 Maintenance Connection Inc., a Davis, Calif.-based provider of computerized maintenance management system software, has raised an undisclosed amount of growth equity funding from TA Associates.

 New Harbor Capital has acquired a majority stake in Wedgewood Pharmacy, a Swedesboro, N.J.-based compounding pharmacy focused on animal health, addiction medicine and urology. No financial terms were disclosed.

 Platinum Equity has agreed to acquire JM Swank, a North Liberty, Iowa-based food ingredient sourcing and distribution company, from ConAgra Foods Inc. (NYSE: CAG) for an undisclosed amount.

 Safanad has acquired a control stake in Rimstock PLC, a UK-based manufacturer of cast and forged aluminum automotive wheels. No financial terms were disclosed.

 Sentinel Capital Partners has acquired The Luminaires Group, a Quebec-based manufacturer of specification-grade and architectural lighting fixtures. No financial terms were disclosed.

 W Energy Partners, a new platform for acquiring and developing exploration and production assets in the Bakken shale play, has secured up to $150 million in equity funding from Crestview Partners.


 Selecta Biosciences Inc., a Watertown, Mass.-based developer of targeted antigen-specific immune therapies, has set its IPO terms to 4.25 million shares being offered at between $14 and $16 per share. It would have an initial market cap of approximately $254 million, were it to price in the middle of its range. The company plans to trade on the Nasdaq under ticker symbol SELB, with UBS and Stifel serving as co-lead underwriters. Selecta has raised around $148 million in VC funding (most recent post-money value of $245m), from firms like Polaris Partners (14.3% pre-IPO stake), Flagship Ventures (13.5%), Rusano (10.9%), OrbiMed Advisors (9.3%), Leukon Investments  (7.7%), NanoDimension (5.3%), Sanofi-Genzyme BioVentures, Ridgeback Capital Management, Osage University Partners, AJU IB Investment, Sphera Global Health Care Fund, I2BF and Eminent Venture Capital.

 Tactile Systems Technology Inc., a Minneapolis-based provider of at-home lymphedema treatments, has set its IPO terms to 4 million shares being offered at between $14 and 416 per share. It would have an initial market cap of around $236 million, were it to price in the middle of its range. The company plans to trade on the Nasdaq under ticker symbol TCMD, with Piper Jaffray, William Blair and Canaccord Adams serving as lead underwriters. Tactile Systems reports around $1.4 million of net income on $63 million in revenue for 2015. Shareholders include Galen Partners (33.8% pre-IPO stake) and Radius Ventures (11.1%).


 Spearhead Integrated Marketing Communication Group (SZSE: 300071) has agreed to acquire Smaato, a San Francisco-based real-time ad platform for mobile publishers and app developers, for $148 million. Smaato had raised over $45 million in VC funding from firms like Singapore Press Holdings, Aeris Capital and EDB Investments. Read more.

 Tollerton (Greece) and Novator (Iceland) have hired BAML and UBS to find a buyer for Polish mobile operator P4, according to a local media report. The deal could be worth nearly $3 billion (including debt). Read more.


 Airbus (Paris: AIR) is in talks to sell off its remaining 23.6% stake in Dassault Aviation (Paris: DSY), which is valued at around $2.4 billion, according to Bloomberg. Read more.

 Daniel Ek, co-founder and CEO of Spotify, said yesterday that he has no intention of selling the music streaming company. Read more.

 Envision Healthcare Holdings Inc. (NYSE: EVHC) is in talks to merge with AmSurg Corp. (Nasdaq: AMSG), according to the WSJ. An agreement could be announced by as early as next week, with the combined physician and medical services company valued at more than $9 billion. Read more.

 Kite Realty Group Trust (NYSE: KRG) is in merger talks with rival shopping center developer and landlord WP Glimcher Inc. (NYSE: WPG), according to Reuters. Read more.

 Sky Network Television (NZ: SKT) has agreed to acquire the New Zealand business of Vodafone (LSE: VOD) for US$2.4 billion in stock and cash. Read more.

 Vivendi SA (Paris: VIV) has agreed to buy out the 21.7% stake in French mobile gaming company Gameloft SE that are held by the founding Guillemot family. Read more.


No firm or fund news this morning.


 Adam Bergman has joined Wells Fargo as senior VP of cleantech banking. He previously was founder and CEO of Bergman Strategic Advisors and, before that, was a cleantech banker with Deutsche Bank.

 Reza Malekzadeh and Emmanuel Delaveau have joined Partech Ventures as general partners. San Francisco-based Malekzadeh was an early VMWare employee, while Paris-based Delaveau previously was with CNP Assurances.

 Bruno Pati, former CEO of Numerical Technologies, has joined private equity firm Centerview Capital Technology as a partner (he previously had served as an advisor). In other Centerview news, the firm said that it is opening an Atlanta office that will be led by founding partner Dave Dorman, the former chairman and CEO of AT&T.

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