Sistemic Raises Series A

Sistemic Ltd, a Scottish biotech company, closed a series A funding round with lead investors ChimeraBio and the Scottish Enterprise Scottish Co-Investment Fund. The company develops its drug discovery technology.

Press release:

Fast growing Scottish biotech company Sistemic Ltd today announced that it had closed a series A funding round with lead investors ChimeraBio and the Scottish Enterprise Scottish Co-Investment Fund. The company will use the funding to further develop its proprietary SistemRNA compound-centric drug discovery technology. Using SistemRNA shortens the odds in drug discovery by enabling far more accurate prediction of potential drug indications, interactions and side effects.

“Scottish Enterprise has in important role to play in helping increase private sector investment into Scottish companies. This deal is a great example of how we have worked with private investors to make this happen.”

SistemRNA screens compounds of interest against Sistemic’s knowledgebase of reference compound responses in cell-based models. The process generates information on biological differences, mechanism of action and potential new targets from the associated miRNA expression profiles referenced against the knowledgebase.

According to Sistemic CEO Chris Hillier, miRNA is increasingly seen as key to understanding drug efficiency: “We are able to rapidly release significant asset value for pharma and biotech partners. In addition to de novo discovery, there are major opportunities in repositioning, re-purposing and lifecycle extensions. For example, new indications, formulations and combinations of previously marketed products accounted for 45% of new medicines launched in 2007. Our first contracts have been in oncology but this is a broadly applicable approach. The new funding will enable us to expand our knowledgebase, for example, in cardiac and anti-inflammatory indications, and to accelerate commercial operations.”

Chairman and Partner of ChimeraBio, lead investor, Jim Reid commented: ”I am delighted with Sistemic’s rapid progress. In less than a year they have completed key technical milestones, secured their first contracts and began commercial operations in Boston to serve the key US market. With the strong and experienced management team led by Chris Hillier, I look forward to their continued growth as one of Scotland’s most dynamic new wave of biotech companies.”

Andrew Sloane, head of Scottish Co-Investment Fund for Scottish Enterprise, said, “Scottish Enterprise has in important role to play in helping increase private sector investment into Scottish companies. This deal is a great example of how we have worked with private investors to make this happen.

“Access to equity investment is extremely important for innovative Scottish companies like Sistemic, and this investment will help the company to further develop its capabilities in the field of drug discovery technology.”


Catterton Acquires Aquasana

Catterton Partners, has acquired Sun Water Systems, Inc., the maker of Aquasana, a home water filtration system. Terms of the transaction were not disclosed.

Press release:

Sun Water Systems, Inc., the maker of Aquasana, the #1 rated home water filtration system in America, and Catterton Partners, one of the leading consumer-focused private equity firms in North America, today announced that Catterton Partners has acquired Sun Water Systems. Terms of the transaction were not disclosed.

Founded in 1998, Sun Water Systems, through its Aquasana brand, has become an industry leader in the $2.7 billion water filtration category. The Company’s Aquasana brand, which is backed by 15 years of research and development and 17 patents, is the #1 home water filtration system in the United States and has been voted a “Best Buy” by Consumers Digest magazine six years in a row[1]. In addition to Aquasana, the Company also designs and manufactures water filtration products under alternative brands label for a number of companies in the U.S. and abroad. The Company’s products, which are recognized for their consumer value and superior water quality, include drinking filters (countertop and under the counter), shower filters, whole house filters, and related accessories.

Scott Dahnke, Managing Partner of Catterton Partners, said, “Consumers’ desire for products that advance safety and control and promote health and wellness are driving explosive growth in the demand for residential water filtration systems. With Aquasana, we are partnering with an industry leader in this highly attractive category, while also extending our portfolio with another company that addresses consumers’ growing sensitivity to the environment. By investing in the strong and growing Aquasana brand and capitalizing on the Company’s direct marketing platform, we see significant opportunities to accelerate Aquasana’s growth and market expansion.”

Charles Strand, Founder of Sun Water Systems, said, “Our agreement with Catterton Partners represents an exciting opportunity to further build on the record of growth that we have achieved. In looking for a partner who could further propel Aquasana, we were impressed by Catterton’s success and experience growing numerous other strong consumer brands. I am very proud of what our team has accomplished and equally excited about the additional upside that I am confident we will capture with Catterton’s strategic and financial support.”

In addition to Sun Water Systems, Catterton Partners’ current representative investments in health and wellness focused companies include O.N.E. (One Natural Experience), a provider of premium, all-natural functional beverages; Breyers Yogurt Company, the largest independent yogurt company and one of the most widely recognized yogurt brands in the U.S.; and Healthy Advice Networks, the largest and fastest growing health information company in the U.S. Catterton’s realized investments in health and wellness-focused companies include Odwalla, the leading health beverage brand in the U.S.; Kettle Foods, maker of America’s best-selling all-natural potato chips; and Wellness Pet Food, the leading all-natural pet food company. Catterton’s current representative investments in other environmentally focused companies include MonoSol, the world leader in developing and commercializing specialty water-soluble products, TechTurn, a leader in the data erasure, remanufacturing, remarketing and environmentally-safe recycling of personal computers; and Naya Waters, the only bottled water company producing FDA-approved 100% recycled plastic bottles.

About Catterton Partners

With more than $2.3 billion under management, Catterton Partners is a leading consumer-focused private equity firm in North America. Since its founding in 1989, Catterton has leveraged its investment capital, strategic and operating skills, and network of industry contacts to establish one of the strongest private equity investment track records in the middle market consumer industry.

Catterton Partners invests in all major consumer segments, including Food and Beverage, Retail and Restaurants, Consumer Products and Services, and Media and Marketing Services. Representative investments that Catterton Partners has led include Breyers Yogurt, Cheddar’s Restaurants, Heartland Recreational Vehicles, O.N.E. (One Natural Experience) beverages, Nature’s Variety Pet Food and Restoration Hardware. Representative realized investments include Baja Fresh Mexican Grill, Build-A-Bear Workshop, Frederic Fekkai, Kettle Foods, Odwalla, P.F. Chang’s China Bistro and Wellness Pet Food.

More information about the consumer-focused private equity firm can be found at http://www.cpequity.com.


Climate Change Capital PE

Climate Change Capital Private Equity (”CPE”), a 200 million euro fund dedicated to investments in clean technology companies, has led a convertible bond issue in Metallkraft, a Norwegian developer of recycling processes for cutting solar silicon wafers. CPE subscribed for NOK85 million (10.3 million euros) of the NOK140 million (17.0 million euros) total convertible bond issue alongside existing shareholders and other investors.

Press release:

Climate Change Capital Private Equity (”CPE”), a 200 million euro fund dedicated to investments in clean technology companies, has led a convertible bond issue in Metallkraft, a Norwegian company that has developed a patented process to recycle spent slurry used in cutting solar silicon wafers.

CPE subscribed for NOK85 million (?10.3 million) of the NOK140 million (?17.0 million) total convertible bond issue alongside existing shareholders and other investors. The convertible bonds have a 12% coupon per annum and a three year term.

With plants already operational in Norway and China, Metallkraft will use the proceeds from the convertible bond issue to support its new plant in Singapore which will service the 740 MW wafer plant being commissioned by Renewable Energy Corporation (”REC”), part of the world’s largest integrated solar plant, and future expansion plans in China.

Metallkraft has developed a unique and proprietary advanced mechanical process able to recover 100% of spent slurry used in the solar silicon wafer cutting process. Metallkraft’s solution involves no added chemicals, no waste streams and has a low energy consumption.

Simon Drury, a CPE Partner, said: “In addition to the environmental benefits of its solution, Metallkraft is able to dramatically reduce the slurry costs, providing solar wafer manufacturers with a decisive competitive edge in a fast moving solar industry continuously striving to reduce the overall cost of solar energy.”

“Metallkraft is a perfect fit for CPE’s investment strategy. We firmly believe that Metallkraft’s management team is one of the best we have seen and in my experience this is the most important investment factor to get right” he added.

In relation to CPE’s investment, Simon Drury will take a seat on Metallkraft’s Board of Directors.

Metallkraft’s CEO, Gunnar Kulia, said: “The management team of Metallkraft warmly welcome CPE as a key stakeholder in our company. CPE’s due diligence process led to a positive result and our discussions during the process were detailed, professional and very constructive. I am convinced that CPE’s active participation on Metallkraft’s Board will contribute significantly to our development.”

SEB Enskilda acted as financial advisers to Metallkraft.


Ironwood Pharma Trades Up on Debut

(Reuters) - Investors on Wednesday held on to their reputation of being hard to please.

The shares of drugmaker Ironwood Pharmaceuticals Inc (IRWD.O) raised less than expected, although they did close 3.6 percent above their initial public offering price on their Nasdaq debut.

And Boutique investment bank Imperial Capital Group Inc (ICG.N) postponed its IPO altogether due to “market conditions,” according to an underwriter.

Investors have proved risk-averse so far in 2010 and are hesitant to invest in unproven companies, especially if they are not profitable, analysts have said.

Ironwood has partnerships with Forest Laboratories Inc (FRX.N) and Almirall SA (ALM.MC). It has reported losses each year since it was founded in 1998. It has not yet brought a drug to market.

Ironwood shares closed at $11.65, up from the IPO price of $11.25, on its Nasdaq debut. The company sold 16.7 million shares and raised about $187.5 million. But it raised about 25 percent less in its IPO than it hoped to, according to an underwriter. Ironwood planned to sell shares for between $14 and $16 each.

The shares started trading around 12:40 p.m. EST (1740 GMT) after a delay.

Cambridge, Massachusetts-based Ironwood has one drug — for chronic constipation and irritable bowel syndrome with constipation — in clinical development, but does not have regulatory approval to sell it in the United States or abroad.

The company will use the net proceeds from the IPO to fund drug development and commercialization and for general corporate purposes, it said in a regulatory filing with the U.S. Securities and Exchange Commission.

Los Angeles, California-based Imperial Capital, which postponed its IPO, had hoped to sell 6.7 million shares for between $15 and $17 each, raising about $106.7 million, at the midpoint in a downsized deal.

Imperial offers sales and trading services to institutional investors, a range of investment banking advice and capital markets and restructuring services to middle market clients.

The company more than doubled profits in the first nine months of 2009 to $13.9 million, but said in its prospectus that most of its investment banking engagements are single deals and not ongoing relationships.

Investment banking accounted for about 36 percent of revenue in the nine months ended Sept. 30.

JP Morgan, Morgan Stanley and Credit Suisse led the Ironwood IPO. They have the option to buy an additional 2.5 million shares. Bank of America Merrill Lynch, JMP Securities, and Imperial Capital led the Imperial IPO. (Reporting by Clare Baldwin in New York; additional reporting by Phil Wahba and Megan Davies; editing by Tim Dobbyn; Robert MacMillan and Andre Grenon)

peHUB Note: The company is backed by Ridgeback Capital Investment, with a 13% stake, Venrock (11%), Polaris Venture Partners (8%) and Morgan Stanley (7%). Ironwood raised $323 million in venture funding between 1998 and 2009.


3i Mulls Sale or Float for Ambea

(Reuters) - Private equity group 3i (III.L) is exploring selling Nordic care home operator Ambea or listing it on a stock market, several bankers close to the deal said on Wednesday.

Private Capital

The company, which operates under its Mehiläinen and Carema brands, could fetch somewhere in the 700 million to 1 billion euro ($1.40 billion) range, the bankers said, higher than last year’s estimate of around 600 million to 700 million euros.

Ambea, which provides specialist healthcare in nursing homes and for disabled people, generates stable cash flows.

However, with operations in Sweden, Finland and Norway it could present a multi-jurisdiction challenge for a private equity buyer, according to one of the bankers.

The group generated earnings before interest, tax, depreciation and amortisation (EBITDA) of roughly 70 million euros ($98.08 million) in 2009, several bankers said.

Ambea said 2008 EBITDA was 658.3 million Swedish crowns ($91.33 million), while net debt stood at 2.8 billion Swedish crowns.

Other privately-owned European companies have explored both a public listing and a sale, including UK pet shop chain Pets at Home, which KKR [KKR.UL] bought from Bridgepoint last week for 955 million pounds including debt. [ID:nLDE60Q0BM]

3i explored a possible sale of Ambea earlier last year, but desisted as the credit crisis froze activity in the European leveraged buyout market, one banker said.

Possible bidders now include Advent International, BC Partners [BCPRT.UL] and Investor AB (INVEb.ST) working alongside Goldman Sachs, according to two bankers.

Ambea is majority-owned by 3i Group and related funds, which hold 75 percent of the company, while GIC owns 15.1 percent and management owns the remaining 9.1 percent.

3i, Advent International and BC Partners declined to comment while Investor AB and Goldman Sachs could not immediately be reached for comment.

(Reporting by Zaida Espana and Quentin Webb; additional reporting by Sven Nordenstam in Stockholm and Simon Meads in London; Editing by Erica Billingham)


IFC Invests $2 bln in Sub-Saharan Africa

(Reuters) - The World Bank’s private sector lending arm is investing more than $2 billion in sub-Saharan Africa in the 2009/10 fiscal year as investment opportunities improve, the lender’s head said on Thursday.

“Last year, we did $1.8 billion in sub-Saharan Africa,” Lars Thunell, CEO of the International Finance Corporation, told Reuters following a presentation.

“In the June 2009/10 year, we will grow over $2 billion. We are hoping that we will also mobilise more funds, in total we will do about $2.5 billion.”

The IFC provides loans, equity and advisory services in emerging markets and also looks to draw in investment from institutional investors and sovereign wealth funds.

“We started an asset management company to crowd in even more funds into the emerging markets,” Thunell said in the presentation.

Thunell said a $2 billion transaction with the Japanese government was investing in financial restructuring of banks in four African countries, and the IFC was also looking to close a transaction with sovereign wealth funds to invest in Africa and Latin America. He declined to give details on the size of this transaction.

The World Bank forecasts growth this year of 2.5 percent for Africa and 4.1 percent for sub-Saharan Africa. Thunell highlighted Angola and Rwanda as post-conflict countries that could see 7 percent growth this year.

Political risk was becoming less of an issue for investors in Africa, Thunell told Reuters.

“If you look at the number of conflicts, it’s come down dramatically in the past 10-15 years, which is one of the reasons for the stability. We also have a new generation of leaders coming in, some of them are very very good,” he said, adding:

“But you still have natural resources, you have corruption, nationalisation. There will still be political risk, you can’t shy away from that.”

Emerging markets have led the rally out of the global economic crisis, with benchmark emerging stocks .MSCIEF gaining 74 percent last year.

But little of that increase in emerging market flows was yet coming to Africa, Thunell said in the presentation.

“There is a question of what’s happening in the world economy. The recovery is here but it’s very fragile,” he said.

“Total flows to the emerging markets are projected for this year to be half of what they were in 2007. A lot of those flows are to the big BRIC (Brazil, Russia, India, China) countries, if you look at Africa and the poorer countries, it’s not really come back.” (Editing by Andy Bruce)


Dow Venture Capital Group Invests in Clean Filtration Technologies

Clean Filtration Technologies, Inc. (CFT) held a first closing of $1.5 million in a new round of financing led by The Dow Chemical Company through its Venture Capital group. An additional and final closing is anticipated in 2010 that will bring the total investment to $3 million.

Press Release:

Clean Filtration Technologies, Inc. (CFT) announced that it has concluded a first closing of $1.5 million in a new round of financing led by The Dow Chemical Company (Dow) through its Venture Capital group. An additional and final closing is anticipated in 2010 that will bring the total investment to $3 million.

“This investment by Dow enables us to accelerate our full commercial introduction of this exciting new technology. We welcome the opportunity to work with Dow in this area.”

CFT is the company behind the CFT Turboclone™ hydroclone system, a patented water filtration device designed to efficiently reduce total suspended solids (TSS) from difficult-to-filter water. Reducing this particulate matter produces a consistent high quality feed stream that is suitable for numerous applications such as wastewater reuse, potable water processing, industrial processing and agricultural irrigation. The CFT TurbocloneTM filtration device utilizes both hydroclone and cross flow filtration technologies. This combination creates an efficient treatment solution for difficult to filter feed waters, such as those from many surface or water reuse sources.

In addition to investment support from Dow Venture Capital, the Dow Water & Process Solutions business is excited about the potential of the CFT Turboclone™ system as a separation device for various water treatment applications, including those that utilize ultrafiltration. Commercial supplies of CFT Turboclone™ systems will be available in the second half of 2010 for customers in the USA and Mexico.

“We are delighted that Dow recognizes that the CFT Turboclone™ filtration system has the potential to make a major and sustainable impact on the industry,” said John Mallard, Clean Filtration Technologies’, CEO. “This investment by Dow enables us to accelerate our full commercial introduction of this exciting new technology. We welcome the opportunity to work with Dow in this area.”

“Part of our investment strategy is to support portfolio companies not only with financing but also with access to Dow’s industry expertise, R&D and manufacturing organizations for technology development, and the significant brand equity and validation of a Fortune 50 company,” said Monty Bayer, global director, Dow Ventures & Business Development, Licensing, and Venture Capital. “Resources like these can be vital to a young company’s progress. CFT is a company that we are excited to help support.”

About Clean Filtration Technologies, Inc. (CFT)

Clean Filtration Technologies, Inc. engineers efficient, next generation, water treatment technology. The CFT Turboclone™ hydroclone system is a high capacity filtration device for drinking, waste and process water applications. The CFT Turboclone™ hydroclone system uses a non-consumable, proprietary metal membrane. The membrane is self cleaning and virtually maintenance free. The CFT Turboclone™ hydroclone system can process high turbidity water and reduce suspended solids without fouling or plugging. When used as a pre-filter, the CFT Turboclone™ hydroclone system can allow other treatment technologies to operate with peak efficiency and can reduce maintenance and operation expenses. (www.cleanfiltration.com) CFT Turboclone™ is a trademark of Clean Filtration Technologies, Inc.

About Dow Venture Capital

The Dow Chemical Company working through its Venture Capital group (www.dow.com/venture) invests in promising start-up companies in North America, Europe, and Asia supporting its portfolio with capital, technology, and a global network of potential development partners. Dow Venture Capital is active in sustaining these companies throughout their early critical years, from seed to later stage investment. Dow Venture Capital professionals are located in Midland, Michigan, Zurich, Switzerland and Gotemba, Japan.

About Dow Water & Process Solutions

Dow Water & Process Solutions has a 50 year legacy of providing innovative water and process solutions to both communities and industries alike. A differentiated business unit of The Dow Chemical Company, Dow Water & Process Solutions offers a broad portfolio of ion exchange resins, reverse osmosis membranes, ultrafiltration membranes and electrodeionization products, with strong positions in a number of major application areas, including industrial and municipal water, pharmaceuticals, power, residential water and wastewater and water reuse. More information about Dow Water & Process Solutions can be found at www.dowwatersolutions.com.

About Dow

Dow combines the power of science and technology with the “Human Element” to passionately innovate what is essential to human progress. The Company connects chemistry and innovation with the principles of sustainability to help address many of the world’s most challenging problems such as the need for clean water, renewable energy generation and conservation, and increasing agricultural productivity. Dow’s diversified industry-leading portfolio of specialty chemical, advanced materials, agrosciences and plastics businesses delivers a broad range of technology-based products and solutions to customers in approximately 160 countries and in high growth sectors such as electronics, water, energy, coatings and agriculture. In 2009, Dow had annual sales of $45 billion and employed approximately 52,000 people worldwide. The Company’s more than 5,000 products are manufactured at 214 sites in 37 countries across the globe. References to “Dow” or the “Company” mean The Dow Chemical Company and its consolidated subsidiaries unless otherwise expressly noted. More information about Dow can be found at www.dow.com.


EUCODIS Bioscience Raises $2.76 million

EUCODIS Bioscience, a Vienna-based company providing customized enzymes to the pharmaceutical, chemical, and other industries, has received a cash injection of EUR 2 million ($2.76 million) from existing shareholders. That includes Pontis Capital, Wiener Wachstumsfonds, IBG, and ARAX.

Press release:

EUCODIS Bioscience, a company providing customized enzymes to the pharmaceutical, chemical, and other industries, announced today that it has received a cash injection of EUR 2 million from existing shareholders.

The Company will use these funds to swiftly add new enzyme families to its product portfolio and to accelerate the development of international markets. At the same time, EUCODIS Bioscience is expanding its manufacturing capacity in pace with growing customer demand for its novel enzymes.

Commenting on the capital injection Thomas Fischer, CEO of EUCODIS Bioscience, said: “Following several product launches in 2009 and the recent expansion of our lipases family to 20 enzymes we continue to build our order book. Accordingly, our revenues will finance a good part of our expenses and investments this year.”

Fischer continued: “Given the wealth of business opportunities in front of us, we are extremely pleased that the cash injection will help us to broaden our product range and to ramp up our sales and marketing efforts.”

EUCODIS Bioscience’ shareholders Pontis Capital, Wiener Wachstumsfonds, IBG, and ARAX participated in the cash injection.

Harald Schuerz, Managing Director of Wiener Wachstumsfonds, commented: “We are delighted that the market clearly confirms the business model of EUCODIS Bioscience. The commercial focus and the industrial mindset of their team are impressive. In light of their track record and the market potential, this company will soon be an Austrian IPO candidate.”

Thomas Moser, Managing Partner at Pontis Capital, commented: “We have been impressed with the progress EUCODIS Bioscience has made in commercializing their experience in enzyme development. In addition, they have established a proven technology for the directed evolution of enzymes and have developed a unique expertise in manufacturing specialty enzymes. This provides the right ingredients to make EUCODIS Bioscience a preeminent supplier to the white biotechnology industry.”

About EUCODIS Bioscience

EUCODIS Bioscience GmbH develops, customizes, manufactures, and markets industrial enzymes.

EUCODIS Bioscience’ products help customers in the chemical, pharmaceutical, and food and feed industries to make manufacturing processes more efficient and cleaner, and to generate products with superior properties.

EUCODIS Bioscience originally focused on developing enzymes for industrial partners, including GlaxoSmithKline, Henkel, and Lohmann Animal Health. Since 2009, the Company develops and markets its own products.

Led by an experienced management team, EUCODIS Bioscience is backed by Austrian and German institutional venture capital funds, founders, and private investors. The Company is headquartered in Austria, Europe, with a subsidiary in Germany.


Star Avenue Capital Acquires Interest in J Brand Jeans

Star Avenue Capital has purchased a majority interest in J Brand, a premium denim company. Star Avenue Capital is a Los Angeles-based consumer growth equity vehicle formed in partnership with buyout firm Irving Place Capital and entertainment and sports agency Creative Artists Agency (CAA).

PRESS RELEASE

J Brand, a rapidly growing premium denim company, announced today a strategic investment by Star Avenue Capital, LLC (Star). Star has acquired a majority interest in J Brand and will partner with J Brand’s management team to provide strategic resources to support the company’s growth. Jeff Rudes, Co-Founder and Chief Executive Officer, and Albert Schami, Chief Operating Officer, will continue to serve in their current roles and maintain substantial ownership stakes in the company.

“Star Avenue Capital is pleased to partner with Jeff and his talented management team to strategically support J Brand’s business and to bring it to the next level in the premium denim category,” said Mark Genender, Star Avenue Capital’s Managing Director. “Star was created to invest in growing branded businesses at J Brand’s stage of development and to assist them in executing upon and realizing the many attractive opportunities in front of them.”

Star, based in Los Angeles, is a consumer growth equity vehicle recently formed in partnership with private equity firm Irving Place Capital and leading entertainment and sports agency Creative Artists Agency (CAA). “We have direct access to CAA’s extensive resources and expertise across multiple functional areas including marketing, branding, lifestyle and consumer research, as well as access to Irving Place Capital and its relevant investment experience with consumer and retail companies,” added Mr. Genender. “We are confident that J Brand’s ongoing commitment to its product and customers, coupled with Star’s differentiated approach, will result in a long and successful partnership.”

Headquartered in Los Angeles, J Brand was founded in 2005 by Jeff Rudes and Susie Crippen, and experienced immediate success through the introduction of its women’s skinny jean. The company has since become a leading premium denim brand, both domestically and abroad. J Brand is featured at specialty stores and luxury retailers – in the U.S. (Barneys New York, Bergdorf Goodman, Jeffrey and Ron Herman), London (Harvey Nichols and Selfridges), Paris (Le Bon Marche), Milan (Biffi), and Moscow (Tsum), among others. Upon the closing of the transaction, Susie Crippen, Creative Director, will be leaving the company to pursue other endeavors. The Company’s experienced and talented creative marketing team will remain in place.

Mr. Rudes said, “We are very excited about the partnership with Star Avenue Capital and the strategic resources it will provide J Brand as we grow the business further and expand into new categories. Star, CAA and Irving Place Capital understand our core values and the importance of product quality, fit and innovative design. All three partners bring unique expertise and their ongoing involvement will be critical to our continued success.”

“From the day we started with J Brand, it has been one of the top performing brands in premium denim, and in the store, for that matter,” said Frank Doroff, Vice Chairman of Bloomingdales. “Our customers had an immediate positive response to the product. We just finished the fall 2009 season, and J Brand’s business continues to grow and prosper.”

J Brand represents Star’s first investment. Star was formed to invest in up-and-coming consumer branded businesses to which the collective Star partnership would bring strategic value. Star’s investment in J Brand was funded by a group of third-party strategic and institutional investors, including a co-investment by private equity firm Genuity Capital Partners. In conjunction with Star’s investment, Peter Boneparth, a senior advisor to Irving Place Capital and the former CEO of Jones Apparel Group, will become Chairman of J Brand. The Star venture and partnership with CAA enhances Irving Place Capital’s already strong consumer and retail franchise.

Terence Bogan, Vice President, Divisional Merchandising Manager for Women’s CO-OP at Barneys, commented, “We are very gratified by the business Barneys has developed with J Brand over the years. Jeff and his J Brand team have given Barneys the ability to offer our clients the best assortment of product available in the marketplace. Through a challenging economic climate, J Brand continues to exceed sales expectations. We look forward to our continued success in building an increasingly meaningful J Brand business.”

The Sage Group, LLC acted as the exclusive financial advisor and Proskauer Rose LLP acted as counsel for J Brand. Bank of America Merrill Lynch’s Global Commercial Banking Group provided the acquisition and working capital financing. Star was represented by Kirkland & Ellis LLP’s Los Angeles office.

About J Brand

J Brand creates classic and sophisticated jeans with an emphasis on fit, while holding true to its commitment to deliver timeless product. Since its inception, J Brand has consistently introduced new styles, which have been extraordinarily popular with celebrities and leading fashion editors. In the fall of 2008, the J Brand men’s line was introduced, reflecting modern classics with a masculine sensibility. In 2009, J Brand collaborated with famed designer Hussein Chalayan to create a collection of unique denim pieces that were featured in his Paris runway show. Having achieved significant sales growth over the past five years, the brand has become known as an industry leader. For more information, please visit www.jbrandjeans.com.

About Star Avenue Capital

Star Avenue Capital is an innovative middle-market growth equity vehicle established in conjunction with Irving Place Capital and Creative Artists Agency to invest in up-and-coming consumer and retail brands and concepts to which its unique combination of resources can add significant value. J Brand represents Star’s first investment. Star is led by Mark Genender, an experienced private equity investor with a proven track record of creating value for consumer and retail companies.

About Irving Place Capital

Irving Place Capital invests private equity capital in compelling buyouts, recapitalizations and growth capital opportunities alongside superior management teams. Irving Place Capital focuses on making control or entrepreneur-driven investments. Since its formation in 1997, Irving Place Capital has been an investor in 68 portfolio companies, and manages over $4 billion of equity capital, including its current $2.7 billion institutional fund. The firm’s notable retail and apparel investments have included, Aéropostale, New York & Company, Seven for All Mankind, Stuart Weitzman and The Vitamin Shoppe. More information about Irving Place Capital is available at www.irvingplacecapital.com.

About Creative Artists Agency

Creative Artists Agency is the world’s leading talent agency, representing many of the most successful professionals working in film, television, music, video games, theatre, and the Internet, and provides a range of strategic marketing and consulting services to corporate clients. CAA is also a leader in sports, representing more than 500 of the world’s top athletes in football, baseball, basketball, hockey, soccer, tennis, and golf, and works in the areas of broadcast rights, corporate marketing initiatives, licensing, and sports properties for sales/sponsorship opportunities. In addition, The Intelligence Group, a market research and trend forecasting company, is a division of CAA.


PE-Backed Spheris Files for Bankruptcy

WILMINGTON, Del. (Reuters) - Spheris Inc, a provider of document services for hospitals, filed for bankruptcy on Wednesday and plans to sell its U.S. business to MedQuist Inc, its largest competitor, for $75.25 million, according to court documents.

As part of the sale, CBay Inc would acquire the stock of Spheris India Private Ltd, a unit of Spheris that is not part of the bankruptcy, according to a press release.

MedQuist (MEDQ.O) and CBay Inc are portfolio companies of CBaySystems Holdings Ltd (CBAY.L).

If approved, the deal would create the largest medical transcription company.

To support Spheris’ business during the bankruptcy, its lenders will extend a $15 million debtor-in-possession loan.

As a condition of the loan, the company agreed to auction its U.S. business, with MedQuist acting as a “stalking horse” bidder and setting the initial auction price.

Such bankruptcy sales are often used as a way to provide a quick recovery for creditors. MedQuist said in a statement it expects the sale to close in the first half of the year. The deal must be approved by a bankruptcy judge.

The proceeds from the auction will be used to satisfy Spheris’ debt, which included $75.6 million in secured loans and $125 million in unsecured debt, according to court documents.

The company said in court documents that significant technological changes pushed down prices for its services, depressing revenues and leaving it unable to service its debt.

The company’s medical language specialists receive digital medical dictation from physicians and then convert this into text and transmit the records back, sometimes in less than a few hours.

Spheris employs 4,200 specialists, with 1,900 of them in India.

Mount Laurel, New Jersey-based MedQuist employs 6,000 medical transcriptionists and 7,500 overall.

Spheris, which is based in Franklin, Tennessee, is owned by Warburg Pincus, TowerBrook Capital Partners and Community Health Systems Inc (CYH.N), according to court documents.

Spheris did not immediately return calls for comment.

Shares of CBaySystems ended up 3.4 percent in London. Shares of MedQuist closed 4.05 percent higher on Nasdaq.

The case is In re Spheris Inc et al, U.S. Bankruptcy Court, District of Delaware, No. 10-10352. (Editing by Gerald E. McCormick, Gary Hill)


Dave Asprey Joins Trinity Ventures

Dave Asprey has joined Trinity Ventures as an entrepreneur-in-residence. He previously was VP of technology and corporate development with Blue Coat Systems.

What follows is Apsrey’s bio, from the Trinity Ventures website:

Dave has 17 plus years of experience working in strategic planning, product management, and corporate & business development. He has worked at service provider, telecom, networking, virtualization, CDN, cloud computing, and SaaS companies, that range from small startup to Fortune 500. During that time, three of his companies were acquired, he started two early cloud computing services, he owned strategic planning for two public companies with more than $1 billion in revenue, and he ran diligence for acquisitions ranging in value from $10 million to $6 billion.

Prior to joining Trinity Ventures as an EIR, Dave was VP of Technology and VP of Business & Corporate Development at Blue Coat Systems. During his time there, he was responsible for all strategic partnerships, including Microsoft, VMware, Dell, Oracle, and SAP, contributing to about $50 million in annual revenue.

Before Blue Coat, Dave was at UK-based virtual appliance company Zeus Technology, where he was VP of Marketing and Technology Strategy. During his time at Zeus, the company grew more than 60% annually, he created Zeus’ successful cloud strategy.

Prior to Zeus, Dave owned strategic planning for Citrix’s then-$700 million virtualization business unit, reporting directly to the CTO. He was responsible for the launch of the company’s first virtual desktop broker. He joined Citrix through the acquisition of NetScaler where he was Director of Product Management for acceleration and WAN optimization. Before that, he was Senior Director of Product Management at Trinity Venture’s portfolio company Speedera Networks (now Akamai), and he spent 5 years at Exodus Communications (now Savvis), where he was a founder of the 1500 person professional services organization. During that time, he also ran the web and Internet Engineering Certification Program for the University of California at Santa Cruz.

He studied Computer Science at UCSB, Computer Information Systems at Cal State and has an MBA from Wharton.


Aersale Buys Freighter Aircraft Fleet

AerSale, a Coral Gables, Fla.-based provider of aftermarket aircraft, engines and components, has acquired  a fleet of 44 Douglas DC8-71F/-73F series freighter aircraft. No financial terms were disclosed. AerSale recently raised $250 million from Leonard Green & Partners.

PRESS RELEASE
AerSale announced today the acquisition of a fleet of 44 Douglas DC8-71F/-73F series freighter aircraft powered by CFM56 engines. Included in the purchase is the company’s entire inventory of CFM56-2C1 engines, DC8-70 series spare parts & tooling, and a Level D (full motion) DC8-70 series flight simulator

“One of the cornerstones of our business model is to facilitate airlines with their fleet transitions,” stated Nicolas Finazzo, AerSale’s Chief Executive Officer. “Dealing with a single counterparty that can efficiently realize the value of such a diverse package of difficult to finance aviation assets was a major factor in AerSale winning the contract. This transaction is only the first of several large scale multi-fleet acquisitions included in our 2010 forecast.”

The Douglas DC8-70 fleet was manufactured in the late 1960s and early 1970s, and was re-engined with the CFM56-2 powerplant in the early 1980s. This engine series also powers the Boeing KC135 tanker and E-3 AWACS fleets flown by the US and numerous foreign militaries. There are approximately 2,300 CFM56-2 engines in operation worldwide. The CFM56-2 is the predecessor to the CFM56-3 and other CFM56 family engines which have broad application across the world’s fleet of passenger and cargo aircraft.

“With this package we can effectively service the remaining DC8-70 fleet despite its limited future; however strategically, the real value comes from the parts value of the engines,” added Robert B. Nichols, AerSale’s Chief Operating Officer. “With over 180 CFM56 engines included, AerSale is already positioned to become the leading provider of aftermarket CFM56 material. This is welcome news to our MRO customers who will depend upon a reliable source of aftermarket inexpensive high quality OEM parts, as an alternative to expensive new parts. Their customers in turn benefit by lower shop visit costs, which ultimately extends the economic lives of maturing CFM56 powered fleets.”

About AerSale. AerSale is a global provider of aftermarket aircraft, engines, and their component parts to airlines, leasing companies, and OEM/MRO service providers. AerSale’s parent company is AerSale Holdings, Inc., which recently completed a $250 Million equity raise with an affiliate of Leonard Green & Partners, LP.

www.aersale.com

About Leonard Green & Partners, L.P. Leonard Green & Partners, L.P. is one of the nation’s leading private equity firms with over $9 billion in equity commitments under management. Leonard Green & Partners, L.P. was founded in 1989 and has invested in 46 companies with an aggregate value of $35 billion. For more information, please visit www.leonardgreen.com.


Imperial Capital Group Postpones IPO

NEW YORK (Reuters) - Boutique investment bank Imperial Capital Group Inc postponed its initial public offering, an underwriter said, citing market conditions.

The Los Angeles-based company had hoped to raise about $107 million in a deal that had already been downsized.

The bank, which offers sales, trading and advisory services, had hoped to sell 6.7 million shares for between $15 and $17 each.

Imperial Capital more than doubled profits in the first nine months of 2009 to $13.9 million, but said in its prospectus that most of its investment banking engagements are single deals and not ongoing relationships.

It planned to use net proceeds from the IPO to buy partnership units from ICGI Holdings, for additional capital, to repay revolving credit, and for general corporate purposes, according to a regulatory filing with the U.S. Securities and Exchange Commission.

The IPO was being led by Bank of America Merrill Lynch, JMP Securities, and Imperial Capital. (Reporting by Clare Baldwin in New York; additional reporting by Elinor Comlay, editing by Dave Zimmerman)


Terra Firms Asks LPs To Cover EMI Shortfall

LONDON (Reuters) - Guy Hands is to ask investors in his private equity group Terra Firma for 100 million pounds ($159.9 million) to cover a shortfall, saying its music company EMI will be unable to meet its loans from Citigroup this year, the Financial Times reported on Thursday.

A spokesman for Terra Firma [TERA.UL] declined comment on the report. Spokesmen for EMI [LNDONE.UL] could not be reached.

Terra Firma bought EMI in 2007.

The British private equity group last month launched a lawsuit against Citigroup (C.N), demanding billions of dollars in damages relating to its 2007 buyout of EMI in which Citigroup acted as adviser for EMI and sole financier to Terra Firma. Terra Firma accuses Citigroup of fraud. The U.S. bank has said the lawsuit is “without merit.”


IPO Market Shows Signs of Constipation

There are all kinds of puns one could make up about a company developing treatments for irritable bowel syndrome that just pulled off a somewhat disappointing initial public offering.

For negative spin, one could talk about how no one seems able to unclog the life sciences IPO market. Or, for a more positive take, how a bowel company’s market debut, though priced below expectations, offers some signs of relief for the blocked-up pipeline of initial public offerings.

But bathroom humor has no place in financial reporting. That’s especially true for very bad bathroom humor. That’s why it’s probably best to stick to the facts about Ironwood Pharmaceuticals’ Thursday debut on the Nasdaq Stock Market.

The company priced its 16.7 million share offering at $11.25 – about 30% less than the  proposed maximum offering price per share of $16 that Ironwood listed in its IPO prospectus. It was the biggest price reduction for a U.S. IPO this year, according to Bloomberg News, which estimated the company’s market cap at $1.1 billion.

Still, the stock did rise in first-day trading, amid a down day for the broader market. Ironwood shares closed at $11.65, up 3.6% in first-day trading. Ironwood raised about $187.5 million in the offering.

The Cambridge, Mass-based company’s largest venture and private equity stakeholders include Ridgeback Capital Investment, with a 13% stake, Venrock (11%), Polaris Venture Partners (8%) and Morgan Stanley (7%).

Ironwood raised $323 million in venture funding between 1998 and 2009, according to Thomson Reuters. The company plans to use the proceeds from the IPO to fund drug development and commercialization and for general corporate purposes.


Isthimar Puts Inchscape Shipping On The Block

LONDON/DUBAI (Reuters) - Dubai World’s investment arm Istithmar aims to sell port and shipping agent Inchcape Shipping Services (ISS) for up to $700 million, and has drawn interest from private equity, people familiar with the matter said.

Istithmar is likely to appoint Bank of America Merrill Lynch and Royal Bank of Scotland to manage the sale, after meeting with a group of banks, the people said, although some cautioned that the duo had not yet received formal mandates.

Advent International, Cinven [CINV.UL], Montagu Private Equity, and TPG Capital [TPG.UL] are among the buyout firms working on bids, the people said.

The Financial Times reported that Charterhouse Capital Partners [CHCAP.UL] and Kohlberg Kravis Roberts & Co [KKR.UL] were also working on potential bids for London-based Inchcape, which is one of the world’s biggest marine management firms with some 200 offices globally.

The sale is at an early stage but some bidders have already held informal discussions with ISS management, one of the people familiar with the matter said, adding that a $700 million price tag would represent about 10 times ISS’s earnings before interest, tax, depreciation and amortisation (EBITDA).

ISS, BoAML and RBS declined to comment. The private equity firms either declined to comment or were not immediately available for comment.

Dubai World [DBWLD.UL] is seeking to offload assets as part of a restructuring plan. The state-owned conglomerate rocked global markets last November when it asked for a delay on paying $26 billion in debt linked to its main property units.

Istithmar bought Inchcape for $285 million in 2006 from London-based private equity fund Electra Investment Trust.

(Reporting by Quentin Webb, Simon Meads and Susan Fenton in London and Nicolas Parasie in Dubai; Editing by Leslie Gevirtz and Elaine Hardcastle)


IDC Bids Due in Mid-February

NEW YORK (Reuters) - Initial bids for Interactive Data Corp (IDC.N), the financial market data provider controlled by Pearson PLC (PSON.L), are due in mid-February, sources familiar with the situation said.

Interactive Data has a market value of about $2.8 billion, based on Tuesday’s closing share price of $29.35 on the New York Stock Exchange. That values Pearson’s 61 percent stake at roughly $1.7 billion.

U.K. publisher Pearson, which owns the Financial Times newspaper as well as the world’s biggest educational publishing business and Penguin books, said in January that Interactive Data’s board was conducting a preliminary review of strategic alternatives for the company.

Several private equity firms are expected to put in initial bids, the sources said.

Goldman Sachs, which is representing the sellers, has suggested to potential buyers it could offer debt financing at a multiple of 5.5-5.75 times Interactive Data’s earnings before interest, taxes, depreciation and amortization (EBITDA), some of the sources said.

Other banks are suggesting offering slightly higher leverage multiples — up to 6 times — they said.

The banks’ willingness to offer debt at these multiples signals an ongoing improvement in the financing markets. Prior to the credit crunch, it was common to finance private equity deals with large amounts of debt. But in recent months, many deals were being financed with a higher proportion of equity.

Interactive Data sells financial information and analytical tools to banks and other financial institutions, bringing it stable revenue that makes it an attractive buyout target.

One source described the process as being fluid, meaning that the timetable for the sale could change.

Selling the stake would let Pearson use the proceeds for other acquisitions in education in emerging markets or digital learning.

Representatives for Goldman Sachs, Bedford, Massachusetts-based Interactive Data and London-based Pearson declined to comment. (Reporting by Megan Davies and Anupreeta Das; Editing by Derek Caney)


BrightRoll Raises $10 Million

BrightRoll, a San Francisco-based video advertising network, has raised $10 million in Series C funding. Scale Venture Partners led the round, and was joined by return backers True Ventures, Adams Street Partners and KPG Venture. The company previously raised $6 million. www.brightroll.com


Synopsys Buys VaST Systems

Synopsys Inc. (Nasdaq: SNPS) has acquired VaST Systems Technology Corp., a Sunnyvale, Calif.-based producer of embedded systems development technology. No financial terms were disclosed. VaST has raised nearly $42 million in total VC funding since its 1997 formation, from firms that include  Allen Buckeridge, Foundation Capital, ZenShin Capital and Mohr Davidow Ventures.

PRESS RELEASE

Synopsys, Inc. (Nasdaq: SNPS), a world leader in software and IP for semiconductor design, verification and manufacturing, today announced it has acquired VaST Systems Technology Corporation to extend its virtual prototyping solutions into the automotive and consumer application space. The acquisition adds a comprehensive set of processor sub-system models frequently found in automotive and consumer applications to Synopsys’ virtual prototyping portfolio. Processor sub-system models allow developers to accelerate the virtualization of electronic systems and to start software development nine to 12 months prior to the availability of silicon.

“In order to meet the stringent development requirements associated with today’s growing electronics and software content in automotive and consumer products, developers are virtualizing their electronic sub-systems to start software development earlier, improve their productivity and deliver better-tested, higher quality products,” said Joachim Kunkel, senior vice president and general manager of the solutions group at Synopsys. “By adding VaST’s complementary virtual prototyping solutions to Synopsys’ existing virtual and rapid prototyping product portfolio, we can deliver a robust system prototyping solution to automotive and consumer application developers.”

Virtualization is a key technology to improve software development productivity and system verification. Virtual prototypes enable pre-silicon software development and complement traditional hardware/software verification approaches. They represent one of the fastest-growing opportunities in the system-level design and verification market segment.

The terms of the deal, which closed February 1, are not being disclosed. Synopsys does not expect the transaction to have a material impact on 2010 revenue or earnings per share (EPS).

About Synopsys

Synopsys, Inc. (Nasdaq: SNPS) is a world leader in electronic design automation (EDA), supplying the global electronics market with the software, intellectual property (IP) and services used in semiconductor design, verification and manufacturing. Synopsys’ comprehensive, integrated  portfolio of implementation, verification, IP, manufacturing and field-programmable gate array (FPGA) solutions helps address the key challenges designers and manufacturers face today, such as power and yield management, software-to-silicon verification and time-to-results. These technology-leading solutions help give Synopsys customers a competitive edge in bringing the best products to market quickly while reducing costs and schedule risk. Synopsys is headquartered in Mountain View, California, and has more than 65 offices located throughout North America, Europe, Japan, Asia and India. Visit Synopsys online at http://www.synopsys.com/.


Anthera Pharma Sets IPO Terms

Anthera Pharmaceuticals Inc., a San Mateo, Calif.-based developer of anti-inflammatory drugs, has set its proposed IPO terms to around 4.61 million common shares being offered at between $13 and $15 per share. The company plans to trade on the Nasdaq under ticker symbol ANTH, with Deutsche Bank Securities serving as lead underwriter.

Anthera has raised around $75 million in VC funding, from firms like VantagePoint Venture Partners (32.97% pre-IPO stake), Sofinnova Ventures (21.24%), Caxton Advantage Life Sciences Fund (6.09%), HBM BioCapital (6.07%), Pappas Ventures (5.55%) and Mitsubishi International Corp. www.anthera.com