Report: Gala Coral Seeks Waiver in Debt Restructuring

LONDON (Reuters) - British gaming group Gala Coral, laden with debts of 2.5 billion pounds, has asked for three waivers from senior debt holders including a request to delay publishing its annual accounts, the Daily Telegraph reported on Saturday.

Gala Coral, home to bingo halls and a chain of bookmakers, is in the middle of a long-running debt restructuring that has seen lenders and private equity suitors vie for control of the gaming giant, owned by Candover (CDI.L), Cinven [CINV.UL] and Permira [PERM.UL].

The group has offered a fee equivalent to 0.125 percent — or around 2.3 million pounds — of its 1.83 billion pounds ($2.92 billion) of senior debt in exchange for delaying its accounts, skipping a Jan 26 covenant test and being allowed to hold separate talks with senior lenders and mezzanine debt holders, the Telegraph reported without citing sources.

Gala Coral has given senior lenders, led by Royal Bank of Scotland (RBS.L), until next Friday to respond, the paper said.

Senior lenders have also asked mezzanine debt holders, owed 540 million pounds and led by Park Square and Intermediate Capital Group (ICP.L), to inject 150 million pounds into Gala Coral if they are to reach an agreement on how to restructure the 2.5 billion debt, the Financial Times reported on Saturday citing people close to the situation.

Gala Coral could not be reached immediately for comment.

While mezzanine holders are seen as front runners to agree a deal, Gala Coral received counter proposals from private equity firms Blackstone (BX.N) and Apollo Management, a source familiar with the process told Reuters in December. (Reporting by Andy Bruce) ($1=.6269 Pound)


Solomon Owayda Joins Siguler Guff

Solomon Owayda has joined Siguler Guff as a managing director. He previously was chief investment officer at SVG Advisers, and before that oversaw private equity investments for the California State Teachers’ Retirement System (CalSTRS).

PRESS RELEASE

Siguler Guff, an independent, multi-strategy private equity firm with over $8 billion in assets under management, announced today that Solomon Owayda has joined the firm as a Managing Director. The firm will leverage Mr. Owayda’s extensive private equity experience to provide specialized investment solutions to investors and to cultivate and manage advisory relationships.

Mr. Owayda said: “This is a great opportunity to join a successful private equity firm like Siguler Guff and to work with a talented group of professionals. I have known individuals at the firm for a long period of time and have always been impressed by their vision and their ability to identify opportunistic trends in a timely manner.”

George W. Siguler, Managing Director and Chief Investment Officer of Siguler Guff said: “I am thrilled to have someone of Solomon’s caliber join the firm. I have known and admired his work at CalSTRS and SVG over the past 20 years.”

Mr. Owayda joins the firm with 23 years of private equity experience. Most recently, he was the Chief Investment Officer at SVG Advisers, an international private equity firm with more than $6 billion in assets under management. Mr. Owayda was on the investment committee for several SVG vehicles, served on many advisory boards and helped establish the secondary business for the group.

Prior to SVG Advisers, Mr. Owayda was the Director of Private Equity at the California State Teachers’ Retirement System (“CalSTRS”). During his tenure at CalSTRS, Mr. Owayda built the private equity program to be one of the largest in the nation and also helped establish its secondary and co-investment programs.

Mr. Owayda holds a B.S. from Marquette University and an M.B.A. from the University of Wisconsin-Madison School of Business. He also attended the American University of Beirut. Mr. Owayda was an Adjunct Assistant Professor of Finance at the Edward S. Ageno School of Business at Golden Gate University.

About Siguler Guff & Company, LP

Siguler Guff & Company is a multi-strategy private equity investment firm with over $8.0 billion of assets under management across three lines of business: fund-of-funds, advisory activities and direct investment funds. Siguler Guff serves approximately 400 institutional clients and 500 high-net-worth individuals, and the funds it manages have invested in approximately 300 private equity funds. The firm is headquartered in New York and has offices in Boston, Chicago, San Francisco, Los Angeles, Moscow, Shanghai and a local affiliate office in Mumbai. To learn more about Siguler Guff, please visit www.sigulerguff.com.


Candover Calls Halt to New Deals from Flagship Fund

LONDON (Reuters) - Candover (CDI.L) has called a halt to all new deals for its flagship fund, leaving the private equity firm to gradually sell off investments and return cash to disgruntled investors.

Candover said on Friday it had reached agreement with investors to stop spending money from its 2008 fund, meaning it will have no further cash to make investments.

The woes of the embattled buyout house, once seen as one of the leading lights in the European private equity industry, demonstrate how the industry’s fortune turned in the downturn.

As deals faltered and returns from investments dried up, Candover was unable to meet its 1 billion euro ($1.43 billion) commitment to its 2008 buyout fund and its default allowed other cash-strapped investors off the hook with their pledges.

Candover said all investors had agreed to terminate the investment period of its 2008 fund early, scaling back investor commitments to just 100 million euros to support the fund’s only investment, oil and gas services business Expro.

“This agreement draws to a close a period of uncertainty for everyone involved,” said Matthew Fallon, chief executive of Candover Investments, the group’s listed parent company. “We can now move forward, with the immediate priorities being the maximisation of value from the existing portfolio,” he said.

Candover said all investors have waived claims against the firm as a result of its defaulting on its commitment, while the listed company would give up any performance fees resulting from Expro to other investors.

Despite the untimely end to the 2008 buyout fund, partners at Candover hope to raise new capital for deals, with options including a new fund or cash raised on a deal by deal basis, a source familiar with the situation said.

By Simon Meads
(Editing by Dan Lalor) ($1 = 0.6983 euro)


Medica To Begin IPO Road Show Next Week

LONDON (Reuters) - French care homes group Medica is set to kick off a series of initial public offerings by private-equity owners this year, people familiar with the deal said on Friday.

Medica, which provides accommodation for old people requiring long-term care, will start talking next week to potential investors for its IPO. It aims to raise at least 250 million euros ($358 million), the sources said.

Bookrunners BNP Paribas (BNPP.PA), Credit Suisse (CSGN.VX) and Royal Bank of Scotland (RBS.L) will start bookbuilding in the week of Jan. 25. Listing is expected around the Feb. 8 week.

A Paris listing would rank Medica alongside competitors including Orpea Sa (ORP.PA) and Korian SA (KORI.PA).

Medica’s IPO proceeds from selling new shares will go to cutting debt and funding its expansion.

AXA Private Equity (AXAF.PA) and BC Partners may also reduce their holdings by selling existing shares, depending on how the IPO is being received.

Medica has waivers from lenders to deleverage the company and start paying dividends, and for BC Partners to drop its stake below 50 percent. The company plans to achieve a free float of 25 percent, sources said.

BC Partners led the acquisition of Medica from private equity firm Bridgepoint in 2006 for about 750 million euros.

Bankers have previously said the IPO proceeds would pay off 185 million euros in mezzanine and term loans, helping reduce the Medica’s leverage ratio to around 4 to 4.5 times debt to earnings before interest, tax, depreciation and amortisation (EBITDA) from 7.3 times, according to Reuters LPC. (Reporting by Daisy Ku; Editing by Erica Billingham and Dan Lalor) ($1 = 0.6983 euro)


TCV Backs Origin Healthcare Solutions

Technology Crossover Ventures has made a “significant growth equity investment” in Origin Healthcare Solutions, a Windsor, Conn.-based provider of healthcare revenue cycle management services. No financial terms were disclosed. Origin Healthcare previously raised capital from Beecken, Petty & O’Keefe & Company, which will remain an investor.

PRESS RELEASE

Origin Healthcare Solutions (“Origin” or the “Company”), an industry leader in healthcare revenue cycle management services and business and clinical intelligence systems, announced that Technology Crossover Ventures (“TCV”) has made a significant growth equity investment in the Company. TCV joins Beecken, Petty & O’Keefe & Company (“BPOC”), an investor since 2006, and management as investors in Origin.

Focused on both office and hospital-based physicians across all medical specialties, Origin supports over 40,000 medical providers nationwide with solutions that offer faster payment and increased collections for medical services rendered, as well as superior business and clinical analytics. Based in Hartford, CT, Origin has grown to 600 employees and over a 1,000 client organizations.

“TCV’s extensive knowledge of the healthcare market and successful track record building companies in the information technology and services markets will help us to continue to aggressively invest in maintaining our technology leadership position while expanding our sales and marketing presence,” said Jeff Kvam, CEO of Origin. “We look forward to broadening our reach within the physician market and continuing to enhance the revenue collection experience.”

As part of the transaction, John Drew, TCV General Partner, will join Origin’s Board of Directors. Ken O’Keefe and Grant Patrick from BPOC and Mr. Kvam will remain on the Origin Board.

“Origin’s software and services simplify complex business and clinical processes for physician offices. This technology innovation has tremendous growth potential in the office-based physician market, a sector we have actively pursued for some time,” said John Drew of TCV. “We are excited to partner with BPOC, Jeff, and the rest of the Origin team to further accelerate Origin’s expansion.”

“We are thrilled to have TCV as an investor in Origin and look forward to working with TCV and management to fully realize Origin’s potential in this large market,” said Ken O’Keefe of BPOC. “TCV is an ideal partner for Origin at this stage of its development.”

About Origin Healthcare Solutions

Founded in 1991, Origin is a healthcare industry leader in physician revenue cycle management services and physician business office and clinical technology. By leveraging superior technology, processes and analytics in healthcare marketplace, Origin has been able to provide industry leading financial performance for its customers. For more information about Origin Healthcare Solutions, visit www.originhs.com or call 800-358-6443.

About TCV

Technology Crossover Ventures (TCV), founded in 1995, is a leading provider of growth capital to technology companies, providing funds to later-stage private and public companies. With $7.7 billion in capital under management, TCV has made growth equity and recapitalization investments in over 170 companies leading to 45 initial public offerings and more than 30 strategic sales or mergers. Representative investments include Altiris, eHarmony, Expedia, Fandango, Liquidnet, Netflix, RealNetworks, Redback Networks, Solect Technology, TechTarget, Travelport, Webroot, and Zillow. TCV has 11 partners and is headquartered in Palo Alto, California. For more information about TCV, visit www.tcv.com.

About BPOC

BPOC is a Chicago-based private equity firm founded in 1996 to invest in middle-market buyout transactions, recapitalizations and growth platforms in the health care industry. The firm manages over $1 billion of capital and has invested in numerous health care provider, product, manufacturing, distribution, outsourcing, managed care and information technology companies. Representative transactions include AbilityOne Corporation, Hospital Physician Partners, The Hygenic Corporation, ISG Holdings, Sirona Dental Systems, Take Care Health Systems, Valitas Healthcare Services and TeamHealth. For more information about BPOC, visit www.bpoc.com.


TIBCO Software Buys Foresight Corp

TIBCO Software Inc. (Nasdaq: TIBX) has acquired Foresight Corp., a Dublin, Ohio-based provider of transaction automation solutions and EDI productivity tools. No financial terms were disclosed. Foresight had raised around $6 million in VC funding from Autora Funds, Core Capital Partners, Fountainhead Capital and River Cities Capital Funds.

PRESS RELEASE

TIBCO Software Inc. (Nasdaq: TIBX) today announced that it has acquired privately-held Foresight Corporation, a leading provider of transaction automation solutions and EDI productivity tools. Financial details of the transaction were not disclosed.

Based in Columbus, Ohio, Foresight has over 400 customers including healthcare payers representing 60 million lives and BlueCross BlueShield organizations in 31 states. Foresight’s products benefit customers by connecting partners and validating transactions, reducing administrative inefficiencies, and addressing mandates such as HIPAA 5010. Foresight also brings TIBCO deep expertise in the healthcare and EDI markets, where its ability to support and validate transactions across a range of standards will complement TIBCO’s core B2B abilities.

Foresight’s Founder and CEO, Robert Fisher, will join the TIBCO management team and continue to lead the growth and development of the Foresight business.

About TIBCO
TIBCO’s technology digitized Wall Street in the ’80s with its event-driven “Information Bus” software, which helped make real-time business a strategic differentiator in the ’90s. Today, TIBCO’s infrastructure software gives customers the ability to constantly innovate by connecting applications and data in a service-oriented architecture, streamlining activities through business process management, and giving people the information and intelligence tools they need to make faster and smarter decisions, what we call The Power of Now®. TIBCO serves more than 3,000 customers around the world with offices in more than 20 countries and an ecosystem of over 200 partners. Learn more at www.tibco.com.


SeaChange Int’l Buying VividLogic

SeaChange International (Nasdaq: SEAC) has agreed to buy VividLogic Inc., a Fremont, Calif.-based provider of software and services to cable television service providers, set-top box manufacturers and consumer electronics suppliers. No financial terms were disclosed. VividLogic raised $3 million in 2005 from Constellation Ventures.

PRESS RELEASE

SeaChange International, Inc. (NASDAQ: SEAC), a leading provider of software and hardware solutions for video-on-demand (VOD) television, today announced that it has entered into a binding agreement to acquire all of the outstanding shares of VividLogic, Inc.  VividLogic is a privately-owned, California-based company that provides software and services to cable television service providers, set-top box manufacturers and consumer electronics (CE) suppliers.  Its software products include tru2way™, Multimedia Home Platform (MHP) and Globally Executable MHP (GEM)-based IPTV operability for set-top box and CE manufacturers, and in-home content protection, as well as funded software development for the creation of service provider-sponsored home media gateways.  The combination of existing SeaChange in-home technologies and the VividLogic platforms will enable SeaChange to capitalize on the market shift towards IP-delivery into and within the home.  

 
Under the terms of the definitive agreement, SeaChange will pay $12 million in cash upon the closing of the transaction, of which $1.2 million will be deposited in escrow with respect to specified indemnification matters.  In addition, VividLogic shareholders will be entitled to the working capital on its balance sheet prior to closing, an amount estimated to be $8.6 million.  Of this $8.6 million to be paid in cash, $3.9 million will be paid at closing, $1.3 million will be paid on each of May 1, 2010 and August 1, 2010 respectively and $2 million will be paid on the one year anniversary of the closing.  VividLogic’s estimated $8.6 million of working capital at the closing includes approximately $5.9 million in cash.
 
In addition, SeaChange is obligated to pay $1 million in cash to shareholders of VividLogic on each of the first three anniversary dates following the acquisition.  The purchase price will also include earnout payments based on the operating performance of VividLogic over the three year period ending January 31, 2013 with payment upon achievement of these metrics occurring annually.
 
VividLogic revenues are estimated to be approximately $7.0 million for calendar 2009, and it is expected to generate a small profit for the year. 
 
Commenting on the acquisition, Bill Styslinger, SeaChange Chairman and CEO noted, “VividLogic expands our software product portfolio by providing wireless gateway, tru2way and MHP capability to our in-home offerings.  Tru2way and MHP are especially important as both North American and European service providers prepare their networks for customer interactive applications.  SeaChange has made great progress with its software strategy.  Not only have we established ourselves as the leader in backoffice, advertising and application software, additionally our various in-home software products are deployed in approximately 30 million devices.” 
 
“As the next generation of in-home devices including wireless gateways and cable-ready televisions emerge, it is important that we embrace these technologies to continue to lead in the in-home software markets,” Styslinger continued.  “In 2010 our restriction to sell TV Navigator in North America is lifted and, combined with our strong set-top software presence, we plan to offer tru2way, MHP and wireless gateway software that will enable our customers to share content and offer next-generation applications.  We are excited about the market changes and the growth opportunities that lie ahead.  VividLogic’s leadership in key areas that complement our own software offerings uniquely position us to lead in the next generation of in-home infrastructure software, middleware and application software.”
 
At the International Consumer Electronics Show (Las Vegas, Jan. 7-10) the companies will demonstrate available solutions in booth Central 15400, including VividLogic’s tru2way software stack and multi-room DVR, and SeaChange’s Intelligent Video Platform for place-shifting across PCs, mobile phones and television set-top boxes. 
 
Blackstone Advisory Partners L.P. acted as the exclusive financial advisor to SeaChange in this transaction.
 
About SeaChange International
SeaChange International is a leading provider of software applications, services and integrated solutions for video-on-demand (VOD), digital advertising, and content acquisition monetization and management. Its powerful open VOD and advertising software and scalable hardware enable cable and telco operators, as well as broadcasters, to provide new on-demand services and to gain greater efficiencies in advertising and content delivery. With its Emmy Award-winning and patented technology, thousands of SeaChange deployments are helping broadband, broadcast and satellite television companies to streamline operations, expand services and increase revenues. Headquartered in Acton, Massachusetts, SeaChange has product development, support and sales offices around the world. Visit www.schange.com.


It’s Official: The Secondary Market Slumped in 2009

2009 was supposed to be a banner year for private equity secondaries. Buyers had raised record amounts of fund capital (i.e., purchasing power), while the recession had generated a profusion of liquidity-challenged sellers. Supply and demand and all that jazz.

But it just didn’t happen.

NYPPEX Private Markets later today will release data on the 2009 secondaries market, showing a 39% decrease in indirect secondary transaction volume between 2008 and 2009. We’re not allowed to publish the report itself, but can share some of the highlights:

*** There was $12.3 billion of Indirect secondaries activity in 2009 (i.e., selling of LP interests), compared to $20.31 billion in 2008. The primary driver here was a lingering bid-ask gap, in which both buyers and sellers assumed the other would budge. NYPPEX suggests that some late-year movement did come from the buyside, as median bids increased by around 20 points between the end of Q1 and the end of Q4 (although that latter number still represented a deep discount).

One explanation for the bid increase is that public equity portfolios rebounded, thus raising portfolio valuations and lowering LP denominator distress. This is supported by the fact that there was approximately $13.9 billion of secondary interests that were offered in 2009, but then withdrawn.

*** The increase in bid prices resulted in an increase in deal activity, with many secondary firms transacting more than 50% of their entire 2009 business in Q4.

*** There was a 57% decline in direct secondaries activity (selling portfolio company interests), from $5.7 billion to $2.4 billion.

*** NYPPEX believes that 2010 will become what 2009 was supposed to be, as both buyers and sellers get more motivated (buyers have dry powder, sellers still need to reblance portfolios). The company predicts $33.6 billion of indirect secondary activity this year, and $9.6 billion of direct secondary activity.

My own guess is that we’ll see an increase in dollars, if only because valuations will continue to rise. That said, I’m not convinced all of that dry powder will necessarily be put to use. LPs over-allocated to the secondary space, and don’t be surprised if some of them begin agitating for secondary fund cuts in Q3 or Q4…


Cellu Tissue Sets IPO Terms

Cellu Tissue Holdings, an Alpharetta, Ga.-based maker of household and industrial paper products, has set its IPO terms to 7.8 million common shares being offered at between $15 and $17 per share. It would have an initial market cap of approximately $316.32 million, were it to price at the high end of its range.

The company plans to trade on the NYSE under ticker symbol CLU, with Goldman Sachs and JPMorgan serving as co-lead underwriters. Weston Presidio holds an 83.8% pre-IPO stake.


BC Partners Cedes Control of Foxtons

LONDON (Reuters) - BC Partners, the private equity owner of Foxtons, has ceded control of the estate agency chain to its banks, resolving a year long standstill with the lenders, a source familiar with the situation said.

Under the terms of the debt-for-equity swap, BC Partners will inject 50 million pounds ($79.76 million) to remain the largest single shareholder in the business, renowned for its fleet of colourful Minis, the source said.

Bank of America Merrill Lynch (BAC.N) and Mizuho (8411.T), which backed BC Partners’ leveraged buy-out of Foxton in 2007 with 260 million pounds in loans, will jointly own a majority of the company’s equity.

Foxtons came to epitomise the woes of the private equity industry as plummeting sales pushed Foxtons into breach of the terms on its debt, as the credit crisis deepened.

The consensual agreement made over the Christmas period will ensure that BC Partners retains a key role in areas such as an eventual sale of the business, the source said.

In a statement made at the end of December, Foxtons Chief Executive Michael Brown said the business continues to trade profitably.

BC Partners declined to comment. Bank of America Merrill Lynch and Mizuho were not immediately available for comment. ($1=.6269 Pound)

(Reporting by Simon Meads and Quentin Webb, Editing by Douwe Miedema and Karen Foster)


TPG Not In Talks with Tompkins

LONDON (Reuters) - Private equity firm TPG Capital is not involved in discussions with London-listed engineering group Tomkins (TOMK.L) about a takeover, a person familiar with the matter said on Friday.

The company’s stock had risen 4.8 percent to 216 pence by 1330 GMT after the Financial Times’s Alphaville website said TPG had been looking at the company and that financing was available for a bid.

(Reporting by Victoria Howley, Editing by Douwe Miedema)


Phase Bioscience Raises $25 Million

Phase Bioscience Inc., a Durham, N.C.-based developer of therapeutic fusion proteins, has raised$25 million in new Series B funding. New Enterprise Associates and a unit of OSI Pharmaceuticals were joined by return backers Hatteras Venture Partners, Johnson & Johnson Development Corp. and Fletcher Spaght Ventures. The company previously raised around $6.8 million.

PRESS RELEASE
PhaseBio Pharmaceuticals, Inc. (PhaseBioTM), a leading company in the discovery and development of therapeutic fusion proteins based on its proprietary Elastin-Like Polypeptide (ELP) technology, has raised $25 million in a Series B financing round. New investors New Enterprise Associates (NEA) and OSI Investment Management, a subsidiary of OSI Pharmaceuticals (OSI), led the round, with participation from existing investors Hatteras Venture Partners, Johnson & Johnson Development Corporation and Fletcher Spaght Ventures.

In conjunction with the financing, NEA General Partner James Barrett, Ph.D., and Principal Justin Klein, M.D., J.D., will join PhaseBio’s Board of Directors as will Robert Ingram, the former CEO/Chairman of GlaxoWellcome. Mr. Ingram is also a partner at Hatteras Venture Partners.

“PhaseBio’s therapeutic platform has the potential to deliver best-in-class biologics addressing numerous diseases. The company has made excellent progress in the establishment of their discovery capabilities and the progress of their pipeline,” said Dr. Barrett. “We are pleased to join the company’s Board of Directors and look forward to working closely with this talented team to advance the company’s promising portfolio of bio-therapeutics.”

Additionally, the company announced that it has executed a Product Option Agreement with OSI Investment Management. “We were very attracted to PhaseBio’s expertise in fusion protein technology and their ELP platform,” stated Dr. Anker Lundemose, Executive Vice President Corporate Development & Strategic Planning of OSI Pharmaceuticals. “In particular, the experience that Chairman Craig Rosen and CEO Chris Prior have had in successfully developing multiple therapeutic fusion proteins attracted us to this program. We look forward to the scientific team at PhaseBio bringing forward promising opportunities for clinical development.”

Craig Rosen, Executive Chairman of PhaseBio, stated, “This company’s transformational ELP technology will create a variety of exciting product opportunities in the coming years.”

About PhaseBio Pharmaceuticals, Inc.

PhaseBio Pharmaceuticals, Inc. (PhaseBio), located in Research Triangle Park, NC, is a development stage, privately held protein engineering company focused on developing the next generation of biopharmaceuticals. The company’s versatile technology is based on biopolymers of elastin-like repeating subunits to which drugs can be attached or peptides and proteins genetically fused, enhancing the pharmacology and delivery of therapeutics.

About New Enterprise Associates

New Enterprise Associates, Inc. (NEA) is a leading venture capital and growth equity firm focused on helping entrepreneurs build transformational businesses across multiple stages, sectors and geographies. With approximately $11 billion in committed capital, NEA invests in information technology, healthcare and energy technology companies at all stages in a company’s lifecycle, from seed stage through IPO. Since the firm’s founding in 1978, NEA’s experienced management team has invested in over 650 companies, of which more than 165 have gone public and more than 265 have been acquired. In the U.S., NEA has two offices in the Washington, D.C. metropolitan area and one in Menlo Park, California. In addition, New Enterprise Associates (India) Pvt. Ltd. has offices in Bangalore and Mumbai, India and New Enterprise Associates (Beijing), Ltd. has offices in Beijing and Shanghai, China. For additional information, visit www.nea.com.


EyeGate Pharma Raises $22.6 Million

EyeGate Pharma, a Paris-based developer of iontophoresis technology to non-invasively deliver therapeutics for ocular indications, has raised $22.6 million in Series D funding (including an initial $11m calldown). Natixis Private Equity and Emerging Capital were joined by return backers Ventech, Innoven Partners and Medicis Capital. The company previously raised around $31 million.

PRESS RELEASE

EyeGate Pharma, a privately held venture-backed pharmaceutical company developing ocular therapeutics, announces today that it has secured $22.6M in Series D venture financing — $11M available in December 2009, the remaining $11.6M held in reserve for future use.

The funding will be used to continue development of EGP-437 for the treatment of Dry Eye Syndrome (DES), an ocular surface irritation affecting several million men and women in the United States. EGP-437, a dexamethasone derived corticosteroid solution, significantly improved the signs and symptoms of DES in a Phase II clinical study. A pivotal study is expected to begin in the first half of 2010.

EGP-437 is part of the Company’s broader strategy of developing a pipeline of medicines for treating ocular diseases using its proprietary EyeGate® II Delivery System, a non-invasive iontophoretic drug delivery system. Iontophoresis is using a small electrical charge to enhance the mobility of molecules across tissues and cells. The EyeGate II Delivery System delivers specially formulated therapeutics across the sclera to the anterior and posterior chambers of the eye.

Participating in this funding are existing investors Ventech, Innoven Partners, and Medicis Capital, and two new investors Natixis Private Equity (NPE) and Emerging Capital. NPE, the investment arm of Natixis, specializes in venture capital, growth capital, buy-ins and buy-outs, and invests primarily in the life science and IT sectors.

About EyeGate Pharma

Eyegate Pharmaceuticals, Inc. is focused on developing treatments for unmet ocular medical needs by employing the EyeGate® II Ocular Drug Delivery System, a non-invasive drug delivery technology. The EyeGate® II delivery system is compatible with a wide range of therapeutics; therefore, it has the potential to address many anterior and posterior segment diseases. EyeGate® II has been studied in over 200 subjects and is the first ocular iontophoretic system to have completed Phase II studies (Dry Eye and Uveitis). For more information, please visit www.eyegatepharma.com.


Jordan Company Confirms Zest Anchors Deal

The Jordan Co. announced that it has acquired a 75% stake in Zest Anchors, an Escondido, Calif.-based manufacturer of dental attachments. No financial terms were disclosed. peHUB previously reported on the deal.

PRESS RELEASE

The Jordan Company, L.P. today announced that The Resolute Fund II, L.P. has acquired 100% of the assets and business of Zest Anchors, Inc. (“Zest”), a second generation family-owned and operated manufacturer of dental attachments.  The acquisition, which was completed on December 31, 2009, was made in partnership with the Zuest Family and certain members of management.  Terms of the transaction were not disclosed.   

Founded in 1972 and headquartered in Escondido, California, Zest is the leading manufacturer of overdenture attachments in the world. As dental implants have gained acceptance within the dental community, the implant industry has grown from an estimated $900 million in global annual sales in 2001 to $3.1 billion in 2008. In 2001, Zest launched its patented LOCATOR® product line, which has achieved worldwide acceptance as the premier removable overdenture attachment device.

Zest’s product line has traditionally addressed the removable full overdenture market rather than permanent or fixed replacements. By targeting this market and not manufacturing its own competitive dental implant, Zest has manufactured a product that is compatible with substantially all of the various OEM implants available to dentists. This allows Zest to reach patients by selling directly to dentists, as well as through implant OEMs and distributors, both domestically and internationally.

“We are delighted to become partners with industry veterans Paul Zuest and Scott Mullaly. We look forward to working with management to capitalize on the global demographic and socioeconomic megatrends supporting dental restoration treatment with Zest’s portfolio of existing and exciting new products,” said Jeb Boucher, Managing Principal of The Jordan Company.

“Zest is acknowledged worldwide as an innovator of dental attachment devices. Our management team has developed a strong pipeline of new products which should propel Zest to the next level of revenues and profitability. We selected The Jordan Company as our partner because they have an excellent track record of helping companies execute their strategic plans and most importantly, the chemistry felt right between our firms,” said Paul Zuest, Chief Executive Officer of Zest.
###
 

About The Jordan Company
The Jordan Company (www.thejordancompany.com), founded in 1982, is a leading middle-market private equity firm with over $5 billion of assets under management and a successful track record of investing in and growing businesses across a wide range of industries.  The firm’s partners have been investing together for more than two decades, establishing The Jordan Company as one of the most experienced and stable investment teams in private equity.  The investment team is supported by the firm’s Operations Management Group, which initiates and supports operational improvements in portfolio companies.  The firm generates deal flow through a well-developed network of sourcing relationships.  Headquartered in New York, The Jordan Company also has offices in Chicago and Shanghai.
About Zest Anchors

Headquartered in Escondido, CA, Zest Anchors, Inc. (www.zestanchors.com) is a global leader in the manufacturing of dental attachments. Zest develops, manufactures, and distributes dental attachments and related devices in over 45 countries.  Every employee of Zest Anchors is dedicated to providing all customers with products and services which meet or exceed requirements, on time, the first and every time. The original ZEST® Anchor Attachment was developed in 1972. Now over 30 years later, the LOCATOR® product line represents Zest’s third generation of attachments and has achieved worldwide acceptance as the premier overdenture attachment in the dental industry. The attachments are stocked in sizes to fit all major brands of implants, as well as for endodontically treated roots.


Twitter Raises $5 Million More?

Twitter, the San Francisco-based micro-messaging service, has raised $5.17 million in new common stock and Series E preferred stock, according to a regulatory filing.

[Update: Chris Lee suggests that this might not be new money in, but rather the stock price paid for Mixer Labs or another acquisition...]

The company previously had raised nearly $100 million in Series E funding ($98.2m, according to filing), from Insight Venture Partners, Benchmark Capital, Institutional Venture Partners, Morgan Stanley, Spark Capital and T Rowe Price. Overall, it has now raised over $160 million.

No new board members are listed on the filing.


Predictive Biosciences Buys OncoDiagnostic Lab

Predictive Biosciences, a Lexington, Mass.-based developer of intervention diagnostic assays for cancer management, has acquired OncoDiagnostic Laboratory, an anatomic pathology and molecular diagnostics lab. No financial terms were disclosed. Predictive Biosciences has raised around $32 million in VC funding from New Enterprise Associates, Kaiser Permanente Ventures, Flybridge Capital Partners and Highland Capital Partners.

PRESS RELEASE

Predictive Biosciences today announced that it has acquired Cleveland, Ohio based OncoDiagnostic Laboratory (“ODL”), a private, Clinical Laboratory Improvement Act (CLIA)-certified anatomic pathology and molecular diagnostics lab serving urologists, gastroenterologists, dermatologists, gynecologists, and other subspecialty physicians nationwide. This strategic acquisition provides Predictive with a fully integrated pathology laboratory through which the company will commercialize its proprietary non-invasive molecular cancer diagnostic assays. Financial terms of the agreement were not disclosed.

The acquisition of ODL represents a significant step forward in Predictive’s business plan, securing for the Company an established commercial operation and accelerating the launch of its high performance assays for improved cancer management. The first in Predictive’s portfolio of non-invasive assays is a urine-biomarker based test for the detection of bladder cancer, which the Company plans to make commercially available during 2010.

“ODL’s subspecialty expertise and national access to hundreds of urology practices including some of the largest group practices in the U.S., such as the Conrad|Pearson Clinic in Tennessee and the Arizona Urology Specialists, favorably position Predictive for launching our bladder cancer test as well as future diagnostic products. In light of ODL’s established national sales presence, its accomplished team of pathologists, history of innovation and consistent high marks for quality and customer service, we could not imagine a better, more mission-aligned partner to proceed with. We look forward to leveraging ODL’s urology focused sales organization to introduce our proprietary bladder cancer assay later this year,” stated Peter Klemm, Ph.D., president and chief executive officer for Predictive. He continued, “Importantly, Predictive and ODL share a common set of values – a commitment to innovation, customer service and patient care – and we are certain that these values will serve as a solid foundation for our merged company’s growth.”

ODL, which was founded in 1985 by a group of pathologists to better serve the growing needs of office-based urologists and other subspecialty physicians, will continue to operate from its Cleveland headquarters. ODL currently employs approximately 40 professionals, including an experienced national sales force that is supported by company pathologists, laboratory staff and customer service.

“ODL has long been one of the most innovative providers of anatomic pathology services, and we feel we have found a like-minded partner in Predictive. We are very enthusiastic about this merger, and the pioneering work that Predictive is doing to improve the diagnostic tools available to physicians,” stated Joseph Galang, chief executive officer for OncoDiagnostic. He continued, “We look forward to being able to offer Predictive’s unique biomarker assays that can help urologists confidently identify a patient’s risk for cancer in a non-invasive, relatively simple and highly reliable manner. We feel very fortunate to be partnering with a remarkably progressive company in this space.”

About OncoDiagnostic Laboratory
OncoDiagnostic Laboratory, Inc. is one of America’s most innovative providers of anatomic pathology services specializing in urology, gasteroenterology, general surgery and aspiration biopsy. Founded in 1985 by Drs. Cirilo Galang, Paul Johenning and John Maksem, ODL introduced the trans-rectal FNA biopsy of the prostate utilizing liquid phase fixation. ODL’s pathologists, in collaboration with Dr. Donald Gleason, developed the Gleason grading of prostate cancer using the FNA technique. The company also developed a proprietary non-carcinogenic fixative, OncoFix II, which allows for dual histological and cytological examination of prostate biopsies. ODL’s mission is to partner with physicians and their teams in providing high quality, state-of-the-art and cost effective diagnostic pathology services, delivered in a timely manner, while providing the most current materials and resources to patients, so well informed decisions can be made.

About Predictive Biosciences
Leveraging its portfolio of patented biomarkers and clinical algorithms, Predictive Biosciences is pioneering intervention diagnostic assays for informed cancer management™. Predictive Biosciences’ tests will enable physicians to reliably determine the presence or absence of cancer. This information, incorporated into current standard clinical practice, should lead to more effective utilization of existing diagnostic tools and ultimately better outcomes for patients. Predictive Biosciences’ first assays are designed to detect urinary biomarkers fundamentally associated with the physiological changes resulting from cancer development and progression. The initial focus for these tests will be the growing cancer survivor population and the large number of individuals undergoing clinical workups for cancer. Predictive Biosciences was launched in 2006 and is privately funded by Flybridge Capital Partners, Highland Capital Partners, Kaiser Permanente Ventures and New Enterprise Associates. For more information and partnership inquiries, visit Predictive Biosciences’ website at www.predictivebiosci.com.


George Dunbar Joins Arboretum Ventures

George Dunbar has joined Ann Arbor, Mich.-based Arboretum Ventures as a venture partner. Last month he stepped down as president and CEO of stem cell company Aastrom Biosciences Inc. (Nasdaq: ASTM). Prior CEO jobs have been with Quantum Dot (bought by Invitrogen) and Epic Therapeutics (Baxter). www.arboretumvc.com


Discera Adds $11 Million

Discera Inc., a San Jose, Calif.-based fabless analog semiconductor company that makes miniature silicon resonators for the frequency and timing control markets, has $11 million in Series D funding. Lurie Investments was joined by return backers Scale Venture Partners, Horizon Ventures and Ardesta. The company previously had raised over $48 million from the aforementioned firms, plus from 3i Group and Partech International.

PRESS RELEASE

Discera (http://www.discera.com), a recognized leader in MEMS based technology for the clock and timing markets, today announced the successful completion of its Series D financing, having raised $11 million. Investors in this round include previous investors Scale Venture Partners, Horizon Ventures, and Ardesta. In addition, they were joined by new investor Lurie Investments. With the close, Mr. William White, Executive Vice President of Lurie Investments joins Discera’s Board of Directors.

“We are excited to have the support and continued investment from our existing partners. The addition of Lurie Investments as an investor to our team brings valuable expertise to Discera and a shared passion for the future of MEMS technology. We raised additional funds in this difficult economic climate to expand our product portfolio and accelerate the growth of our MEMS timing business,” said Bruce Diamond, Discera President and CEO.

Citing Discera’s technology differentiators as an important factor in their investment, Mr. White also noted, “Discera is poised to enter a period of explosive revenue growth as MEMS timing continues to gain acceptance in the marketplace. MEMS technology offers customers new cost effective solutions to their timing needs including smaller packages with more functionality. Due to the need for special packaging, quartz technology has significant limitations on adding features to oscillator products. We are very excited about Discera’s upcoming new products and we expect Discera to gain a large share of the $5 billion timing market.” Lurie Investments is the private investing arm of the Ann and Robert H. Lurie Foundation, specializing in venture capital and private equity investing. Over the past decade, the firm has made a number of investments in the MEMS and Nanotechnology space, as well as substantial investments in life sciences, including devices, diagnostics and therapeutics. Lurie Investment Fund, LLC is based in Chicago, Illinois.

About Discera Founded in 2001 as an extension of pioneering MEMS development work at the University of California at Berkeley and the University of Michigan at Ann Arbor, Discera is a recognized leader in MEMS oscillator technology. The company has 27 MEMS technology patents. Discera was presented with the prestigious Wall Street Journal Innovation Award, and the company’s CTO has garnered the coveted ACE Award for his work on MEMS technology.

Discera’s products are used in a wide variety of electronic systems, and the company’s MEMS oscillators were the first such devices to be catalog listed by a major distributor. More information about the company can be obtained on its website: http://www.discera.com.


TCW Sues Former Star Manager Gundlach

BOSTON (Reuters) - Trust Company of the West sued its former chief investment officer, Jeffrey Gundlach, accusing him of stealing confidential data, lying to potential clients and keeping drugs and pornographic materials in his office.

TCW, the U.S. asset management unit of French bank Societe Generale (SOGN.PA), said in its lawsuit filed on Thursday that the award-winning bond fund manager had misappropriated trade secrets, interfered with the firm’s contractual relationships with clients and committed civil conspiracy among other charges.

Drugs and pornographic materials, discovered in Gundlach’s office after he was fired, violated the firm’s employment regulations, the lawsuit said.

The firm said in the lawsuit that an examination of Gundlach’s office on Dec. 4, the day he was fired, revealed “plastic containers and bags containing green leafy substances and seeds, some explicitly labeled marijuana, as well as three tin foil tubes, the ends of two of which were burnt.”

According to the lawsuit, the office also contained dozens of pornographic magazines and videos.

TCW said in the lawsuit that Gundlach was fired for threatening to take actions that would have jeopardized the firm’s ability to manage clients’ fixed income assets.

Gundlach, who joined TCW in 1985, said in a telephone interview Thursday evening, “I am not distracted by frivolous, pointless, irrelevant and untrue allegations from the TCW lawsuit. Any significant allegations will be proven to be untrue through a legal process.”

A statement earlier in the day from DoubleLine Capital LP, the firm Gundlach opened days after being fired, said the lawsuit’s allegations were without merit.

“The false and hyperbolic personal attacks by TCW are obviously a gratuitous and irrelevant gutter tactic, which merely underscores the weakness of TCW’s claims,” DoubleLine said in the statement.

The lawsuit is the latest move in a battle for customers between TCW and its one-time star manager, who has hired away more than 40 of his former colleagues. Since Gundlach’s departure, TCW clients have withdrawn billions of dollars from the Los Angeles-based firm’s bond funds.

“Given the circumstances, this was always in the cards,” said Aaron Dorr, managing director at Jefferies & Co, who works on fund company mergers and acquisitions. “Asset management businesses are people driven. It always makes for interesting battles when people decamp.”

Gundlach, who was named Morningstar’s bond fund manager of the year in 2006, oversaw about $65 billion of TCW’s $110 billion of assets before he was fired.

At the same time Gundlach was fired, TCW announced it had purchased cross-town rival Metropolitan West Asset Management LLC, which won Morningstar’s top honor in 2005. The fixed income firm, led by Tad Rivelle, managed about $30 billion.

The 39-page complaint filed on Thursday in California Superior Court in Los Angeles also named Gundlach’s new firm, DoubleLine, and three other former TCW employees who joined Gundlach as defendants.

“GREEN LEAFY SUBSTANCES”

The lawsuit seeks unspecified monetary damages, ownership rights of Gundlach’s new firm and other remedies. TCW said the “measurable” harm it had suffered already exceeded $200 million in addition to uncalculated “intangible” losses.

In the complaint, TCW said it found evidence that several of Gundlach’s colleagues who joined him at DoubleLine had spent weeks downloading investment positions, analytical software and proprietary information about clients to portable computer drives.

ABLE GRAPE LLC

Gundlach and other colleagues confronted TCW Chief Executive Marc Stern and threatened to quit the firm at a Sept. 3 meeting, according to the lawsuit. After the meeting they “feigned satisfaction” while “secretly plotting their departures,” TCW said in the lawsuit.

The alleged planning included seeking to lease 24,000 square feet of office space, copying 9 million pages worth of information from TCW computers and registering a corporation in Delaware under the name “Able Grape LLC,” according to the lawsuit. The corporation’s name was changed to DoubleLine four days after Gundlach was fired.

Gundlach’s possible departure from TCW was the subject of speculation throughout 2009, as Societe Generale considered reducing its stake in the firm through an initial public offering or private-equity deal.

Gundlach has said he offered in September to buy the firm from the French bank. But a SocGen spokesman has said the bank never received a serious or formal offer from Gundlach. (Reporting by Aaron Pressman and Svea Herbst; Additional reporting by Jennifer Ablan; Editing by Leslie Gevirtz, Phil Berlowitz)

peHUB Note: Gundlach’s new firm receives a “significant minority investment” from Oaktree Capital Partners


Suture Express May Be Switching Sponsors

Diamond Castle Holdings is in discussions to acquire Suture Express Holdings from Linden LLC and Code Hennessy & Simmons. The transaction was recently granted early termination of the HSR waiting period by the FTC.

Suture Express is a Lexena, Kansas-based distributor of sutures, endo-mechanical products and other disposable medical/surgical products. www.sutureexpress.com