Sep 5, 2018

Axios Pro Rata

By Dan Primack
Dan Primack

Major apologies for mixing up my "Ronaldos" yesterday, an error that generated more reader email than I've ever received about anything. The correct buyer of Spanish soccer club Real Valladolid is retired Brazilian superstar Ronaldo, not current Portugal and Juventus star Cristiano Ronaldo. Okay, moving on...

Top of the Morning
Source: Giphy

It's over for Theranos. The bloodied blood-testing company will officially dissolve, with any remaining cash headed to creditors, per the WSJ. Equity investors get nothing beyond a very costly due diligence lesson.

  • Criminal fraud charges remain pending against Theranos founder Elizabeth Holmes and former company president Sunny Balwani. The next court date is a status conference on October 1, while Balwani also continues to fight the civil SEC charges that Holmes already settled.
  • The company website no longer works. It was still online as of last week.
  • We've still heard not a peep from any of the company's high-profile directors, current or former.

Amazon yesterday passed $1 trillion in market cap, and I got an email pitch that referred to it as a "phoenix" — something presented as a progression from unicorn. No, we are not doing this.

  • Also hearing word that Amazon will close its $1 billion PillPack purchase within the next couple of weeks. In related news, Chinese online pharmacy startup Jianke just raised $130 million with plans to go public in the U.S. next year.

Bio beat: Noted healthcare venture capitalist Beth Seidenberg this morning pulled the wraps off a new fund called WestLake Village BioPartners, just four months after leaving Kleiner Perkins.

  • We originally reported the fund was targeting $350 million and that Seidenberg would be joined by "a public company exec."
  • The final number was $320 million, and the mystery partner is Sean Harper, head of R&D at Amgen (he formally switches jobs at year-end).
  • Also joining as COO is Scott Ryles, who has spent the past 4+ years in that position at Kleiner Perkins.
  • Another surprise is that the fund is based near Los Angeles, not the Bay Area.

Answer key: Last week I asked you to name the South American tech startup that just raised new funding at a unicorn valuation? The answer was Rappi, which quietly snagged at least $200 million in a DST-led round (as Kia scooped on Friday).

Not so fast: Yesterday we noted a Bloomberg report that cosmetics subscription service Ipsy has launched a dual-track exit process.

But sources close to the company say that while there have been conversations with bankers, no engagement letters have been signed, there is no due date for takeover offers and the current plan is to keep diversifying the revenue streams and work toward an IPO that's most likely to come in early 2020.

  • Caveat: Ipsy is no stranger to on-and-off inbound interest on M&A, and the report could shake loose something too good to refuse.

🏈 Yesterday's podcast focused on Nike's decision to add Colin Kaepernick as a face of the company, and my guest was ESPN's Darren Rovell. (Listen) (Subscribe)

  • Also worth noting that we could only find one major bank analyst who wrote a report on Nike's decision, with another telling Axios' Courtaney Brown that he didn't because there was no "upside" to getting involved in such a polarizing issue. Pretty sure the "upside" would be doing the job clients pay you to do...
The BFD
Source: Giphy

The Carlyle Group agreed to sell its majority stake in Getty Images back to the Getty family, six years after purchasing it for $3.3 billion. No financial terms were disclosed, but Reuters puts the enterprise value at $3 billion, including debt, with Carlyle retaining a minority position.

  • Why it's the BFD: Because it appears that Carlyle made a massive miscalculation on digital, in terms of not appreciating how increased adoption would be married to pricing pressure. Combine that with a massive debt-load reliant on increased cash-flows, and you lose money on a multi-billion dollar buyout.
  • Flashback: Carlyle was more than willing to discuss its investment strategy for Getty back in 2012. But it declined interviews today.
  • Pic pick: I couldn't find a photo of Getty Images within Getty Images. Or is every photo in Getty Images actually a photo of Getty Images? It's unclear. So I chose a Giphy.
  • Bottom line: “The debt has been a significant issue for Getty Images over the last few years. Being able to refinance it is going to be transformative for us.” — Mark Getty to the FT.
Venture Capital Deals

ThinCI, an El Dorado Hills, Calif.-based developer of computing platforms for the AI and machine learnings markets, raised $65 million in Series C co-led by Temasek and return backer Denso. Other investors include GGV Capital, Wavemaker Partners, SG Innovate, Mirai Creation Fund and Daimler. www.thinci.com

Kira Systems, a Toronto-based provider of contract analytics software raised US$50 million from Insight Venture Partners. www.kirasystems.com

Vinted, a London-based online marketplace for secondhand clothes, raised €50 million. Sprints Capital led, and was joined by return backers Insight Venture Partners and Burda Media. http://axios.link/oqGF

Wunder Mobility, a German provider of mobility solutions like carpooling and e-scooter rentals, raised $30 million in Series B funding. KCK Group led, and was joined by return backer Blumberg Capital. http://axios.link/EBXy

🚑 Cricket Health, a San Francisco-based developer of tech-enabled kidney care, raised $24 million in Series A funding led by Oak HC/FT led, and was joined by Cigna, LifeForce Capital, iSeed Ventures, Liquid 2 Ventures, First Round Capital, Box Group, Nexus Ventures, Seven Peaks Ventures and Aberdare Management. www.crockethealth.com

SynapseFi, a San Francisco-based startup that helps fintech companies and banks co-develop technologies, raised $17 million in Series A funding co-led by Trinity Ventures and Core Innovation Capital. http://axios.link/Bdf8

Readly, an Austin, Texas-based digital magazine subscription service, raised $12 million from Swedbank Robur and Zouk Capital. www.us.readly.com

Mejuri, a Toronto-based direct-to-consumer fine jewelry brand, raised C$5 million in Series A funding. Felix Capital led, and was joined by Real Ventures, Incite Ventures, BDC and Dash Ventures. http://axios.link/H68f

Tizeti, a Nigerian ISP, raised $3 million led by 4DX Ventures. http://axios.link/YNSf

Private Equity Deals

• Accel-KKR made a growth equity investment in Seequent, a New Zealand-based visual data science company. www.seequent.com

🚑 Ampersand Capital Partners sponsored a management buyout of Neomed-Labs, a Canadian provider of clinical immunology lab services, from the NEOMED Institute. www.neomedlabs.com

🚑 Atlantic Street Capital acquired OrthoBethesda, a provider of orthopedic services in the Washington, D.C. market. www.orthobethesda.com

⛽ EagleClaw, a midstream energy company owned by Blackstone, agreed to buy Caprock, a midstream operator focused on the Permian’s Delaware Basin, from Energy Spectrum Capital and Caprock Midstream Management for $950 million. www.eagleclawmidstream.com

Epiris agreed to buy London-based auctioneer Bonhams, and installed ex-Sotheby’s COO Bruno Vinciguerra as executive chairman. http://axios.link/xxak

⛽ Flywheel Energy, a portfolio company of Kayne Anderson, agreed to buy the Fayetteville, Ark. shale assets of Southwestern Energy (NYSE: SWN) for $1.87 billion in cash. http://axios.link/ExxZ

Stir-Pacifica, a food manufacturer owned by Wind Point Partners, acquired the Sabra Dipping Co.'s salsa business. www.pacificafoods.com

Thoma Bravo agreed to buy Apttus, a San Mateo, Calif.-based provider of quote-to-cash business process automation solutions that had raised over $400 million in VC funding (most recently at a $1.8 billion valuation). Backers included Premji Invest, Salesforce Ventures, K1 Capital, Iconiq Capital, IBM Ventures and Kuwait Investment Authority. http://axios.link/hNxz

Vantage Specialty Chemicals, a Chicago-based portfolio company of H.I.G. Capital, acquired Amarna, a Delta, Colo.-based maker of water-based release agents sold under the Amarnakote brand. www.vantagespecialties.com

Williams Lea Tag, a marketing activation company owned by Advent International, acquired Taylor James, a London-based digital production house. http://axios.link/qt3V

Liquidity Events

Atlassian (Nasdaq: TEAM) bought OpsGenie, a Boston-based IT alerting solution, for $295 million. OpsGenie raised a $10 million Series A round in 2016 from Battery Ventures. http://axios.link/X0hY

SS&C Technologies (Nasdaq: SSNC) is in advanced talks to buy data room company Intralinks from Siris Capital Group, per Reuters. http://axios.link/Ni7V

More M&A

⛽ EOG Resources (NYSE: EOG) sold its British offshore and gas field assets to Tailwind Energy. http://axios.link/G6VA

🚑 Hesperia, a Spanish hotels group, hired JPMorgan to advise on its 8% stake in local peer NH Hoteles, which has received a takeover offer from Thailand’s Minor International, per Reuters. http://axios.link/T36J

Investcorp acquired more than a 40% stake in Swiss private bank PBS. http://axios.link/W2NI

Petershill, a unit of Goldman Sachs Asset Management, acquired a minority stake in the management company of multi-strategy hedge fund LMR Partners. http://axios.link/RfZQ

Fundraising

Audax Group raised $3.5 billion for its sixth flagship private equity fund. www.audaxgroup.com

Edmond de Rothschild terminated fundraising for a private equity vehicle focused on South America’s Andean region, which had targeted $250 million, per PE International. At issue was “deteriorating economic conditions” in some South American countries. http://axios.link/Yvvk

I Squared Capital raised $7 billion for its second infrastructure private equity fund. http://axios.link/twgo

Whitehorse closed its second private equity liquidity fund with $1 billion. www.whitehorseliquidity.com

It's Personnel

Kazuyuki Kido joined KKR as a Tokyo-based managing director. He previously was with Simplex Holdings. http://axios.link/KfTb

Vikram Narula, co-founder of the True North Managers, joined The Carlyle Group as co-managing director for India private equity. http://axios.link/IoML

Shailesh Rao was named head of TPG Growth and TPG’s Rise Fund for India and Southeast Asia. He has been a senior advisor to the groups since last year, before which he led international operations at Twitter. www.tpg.com

Final Numbers
Source: Thomson Reuters Deals Intelligence, Data through 8/30/18
Dan Primack

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