Aug 14, 2018

Axios Pro Rata

By Dan Primack
Dan Primack
Top of the Morning

Illustration: Rebecca Zisser/Axios

Turkey is making news for all the wrong reasons, with the latest being a proposed boycott of U.S. electronic goods like iPhones. So here's a silver scoop for that lira-lined cloud:

  • Alibaba last week acquired a Turkish e-commerce company called Trendyol at an enterprise value of around $750 million.
  • The deal was publicly announced, but the price wasn't.
  • Trendyol, which focuses on fashion sales, was founded by a female entrepreneur named Demet Mutlu in 2009. It had raised around $36 million in VC funding from firms like Tiger Global, Kleiner Perkins and Earlybird Venture Capital.

Today in Tesla: Oh, where to begin? Let's go with Elon Musk last night tweeting that he's working both legal and financial advisors, the latter of which are Goldman Sachs and Silver Lake.

  • Silver Lake is the more interesting name, given that it once helped Michael Dell take his company private. But I'm told that it isn't actually a financial advisor in the traditional sense of the word (i.e., a broker-dealer), nor is it being otherwise compensated as a consultant.
  • Silver Lake also isn't participating on the buy-side. Or at least not yet. Sounds like it's helping Musk, in part, to kick the tires and see if there is a viable proposal in which it could participate.

Tesla also lawyered up this morning, and said that its board has formed a special committee of independent directors Brad Buss, Robyn Denholm and Linda Johnson Rice.

  • Steve Jurvetson remains MIA from Tesla's board, but remains listed on its website. A company spox declined comment when I asked for an explanation or update.
  • The NY Times reports that Tesla's board was taken off-guard by Musk's initial tweet last week about his takeover interest. It adds that the "funding secured" Saudis "had taken none of the steps that such an ambitious transaction would entail."
  • Speaking of the Saudis, just a reminder that any Saudi-backed buyout would undergo a CFIUS review, and that a CFIUS-strengthening bill was signed into law yesterday by President Trump.
  • Axios energy reporter Ben Geman: What Saudi's interest in Tesla says about its long-term oil plans

Finally, it's also worth noting that all of this comes as Chinese electric car maker NIO is planning to go public in the U.S., yesterday filing for a $1.8 billion IPO.

🎙 Hear here: Our latest Pro Rata podcast leads with growing tensions between Silicon Valley and the U.S. military, which I discuss with Founders Fund partner Trae Stephens, who recently wrote a Washington Post op-ed on the subject. Listen via Apple, Google Play or stream it straight from Axios.

The BFD

Diebold Nixdorf (NYDE: DBD), a North Canton, Ohio-based maker and servicer of automated teller machines, has hired Credit Suisse and Evercore to explore a possible sale, per CNBC. Those expressing interest include Bain Capital and NCR (NYSE: NCR).

  • Why it's the BFD: Diebold is the world's largest ATM maker, with a reported 32% share.
  • FYI: Diebold no longer makes voting machines. It sold off that business in 2009.
  • Bottom line: "Diebold shares have been in a freefall since forecasting lower-than-expected EBITDA earlier this month and revealing it would use cash on hand and tap its revolving credit line to buy $160 million of Wincor Nixdorf shares, the German company Diebold [mostly] bought in 2016." — Alex Sherman, CNBC
Venture Capital Deals

🚑 Orchard Therapeutics, a British gene therapy startup that recently bought a drug portfolio from GlaxoSmithKline, raised $150 million in Series funding from backers like Deerfield Management, RA Capital Management and Venrock. http://axios.link/6TyX

Exabeam, a San Mateo, Calif.-based security intelligence platform, raised $50 million in Series D funding from return backers Lightspeed Venture Partners (lead), Aspect Ventures, Cisco Investments, Icon Ventures, Norwest Venture Partners and Shlomo Kramer. http://axios.link/T3dL

🚑 Profusa, a based developer of oxygen-monitoring biosensors, raised $45 million in Series C funding. VMS Investment Group, Tasly Pharma Group and Maxim Integrated Ventures were joined by return backers 3E Bioventures Capital and Atinum Investment. www.profusa.com

Axoni, a New York-based developer of blockchain technology for capital markets, raised $32 million in Series B funding. Goldman Sachs and Nyca Partners co-led, and were joined by Andreessen Horowitz, Citi, Coatue Management, Digital Currency Group, F-Prime Capital, Franklin Templeton, J.P. Morgan, NEX Group, Wells Fargo and Y Combinator. www.axoni.com

• Ubiquity6, a San Francisco-based AR platform for interacting in physical spaces, raised $27 million in Series B funding co-led by Benchmark and return backer Index Ventures. Benchmark’s Mitch Lasky will join the startup’s board. http://axios.link/guOW

• Carbyne, an Israeli “next-gen” emergency response system, raised $15 million in Series B funding. Elsted Capital Partners led, and was joined by Founders Fund. http://axios.link/l2Vu

• Mines.io, a “credit-as-a-service” startup for emerging markets, raised $13 million in Series A funding led by TPG’s The Rise Fund. http://axios.link/dgWH

Airspace Technologies, a Carlsbad, Calif.-based provider of “time-definite logistics,” raised $8 million in Series A funding. Defy led, and was joined by Qualcomm Ventures, Cross Culture Ventures and Schematic Ventures.

Observe.ai, a developer of AI tools for call centers, raised $8 million. Nexus Venture Partners led, and was joined by MGV, Liquid 2 Ventures, Hack VC and return backers Emergent Ventures and Y Combinator. http://axios.link/nEzp

🚑 Sansoro Health, a Minneapolis-based provider of healthcare data integration solutions, raised $8 million in Series B funding. LRVHealth led, and was joined by return backers Bain Capital Ventures and Healthy Ventures. www.sansorohealth.com

MeQuilibrium, a Boston-based HR platform, raised $7 million in Series C funding. HLM Venture Partners led, and was joined by return backers Chrysalis Ventures and Safeguard Scientifics. www.mequilibrium.com

Skupos, a San Francisco-based analytics platform for convenience stores, raised $6.4 million in Series A funding. Toba Capital led, and was joined by Dynamo Fund and Loup Ventures. www.skupos.com

• Audius, a San Francisco-based decentalized music-sharing platform, raised $5.5 million in Series A funding. General Catalyst and Lightspeed Venture Partners co-led, and were joined by Kleiner Perkins, Pantera Capital, 122West and Ascolta Ventures. http://axios.link/yjlt

• SenSat, a UK-based startup that helps computers better understand the physical world, raised £3.3 million in seed funding from Force Over Mass, Round Hill Venture Partners and Zagm. http://axios.link/OCCI

• Edmit, a Boston-based startup focused on finding the best financial deal for college, raised $2.3 million in seed funding. Founder Collective led, and was joined by Rethink Education and Precursor Ventures. http://axios.link/Imyr

Private Equity Deals

Bain Capital agreed to acquire British insurer Esure (LSE: ESUR) for 1.21 billion, or 280 pence per share (37% premium over Friday’s closing price). http://axios.link/7aex

🚑 Federal Street Acquisition Corp. (Nasdaq: FSACU), a blank check acquisition company sponsored by Thomas H. Lee Partners, agreed to merge with Universal Hospital Services, a Minneapolis-based medical equipment and technology company backed by Irving Place Capital. The combined company will have an initial enterprise value of around $1.74 billion. www.uhs.com

Graham Partners has invested in Nuconic, a Vernon, Calif.-based provider of rigid PET plastic packaging solutions to commercial and industrial food processors. www.nuconicpackaging.com

H.I.G. Capital acquired Buck, a New York-based HR consulting and benefits administration firm. www.buckglobal.com

Intapp, a Palo Alto-based portfolio company of Great Hill Partners and Temasek, acquired DealCloud, a Hoboken, N.J.-based provider of CRM and deal management software for investment banks and PE firms that had been backed by Hamilton Lane, Cultivation Capital and Fintop Capital. www.intapp.com

Silver Oak Services Partners has acquired Innovative Discovery, an Arlington, Va.-based provider of e-discovery solutions. www.id-edd.com

Public Offerings

Atotech, a German specialty chemicals company owned by The Carlyle Group, is prepping an IPO, per Reuters. http://axios.link/3B9C

KKR (NYSE: KKR) plans to its non-private equity business in India on a local exchange, per the FT. http://axios.link/F5wG

Liquidity Events

🚑 Ancor Capital Partners and Sentinel Capital Partners sold WellSpring Pharma Services, a Canada-based pharma contract manufacturer, to ANI Pharmaceuticals (Nasdaq:ANIP). www.wellspringcmo.com

More M&A

🚑 Astellas Pharma (Tokyo: 4053) acquired Quethera, a British gene therapy company focused on ocular disorders, for upwards of £85 million. http://axios.link/wPTS

Bustle, a VC-backed online publisher aimed at millennial women, has acquired Flavorpill Media, an online publisher and experiential brand focused on events, Axios’ Sara Fischer reports.

California Water Service Group (NYSE: CWT) increased its all-cash takeover offer for San Jose, Calif.-based water utility SJW Group (NYSE: SJW) by 3% to $1.45 billion, or $70 per share. http://axios.link/NVv1

China Literature (HK: 772), a recent spinoff from Tencent, agreed to buy Chinese digital film and TV production company New Classics Media for around $2.25 billion. http://axios.link/3ei1

🥤 Coca-Cola (NYSE: KO) is acquiring a minority stake in sports drink startup BodyArmor, per the WSJ. http://axios.link/OWyb

Xiaoju Automobile Solutions, the Chinese driver service business recently spun out by Didi Chuxing, acquired Hiservice, a Chinese digital platform for after-service auto care. http://axios.link/HKSj

Fundraising

Andreessen Horowitz is raising around $15 million for a co-investment fund whose limited partners would be black celebrities like Kevin Durant and Will Smith, per the WSJ. http://axios.link/QB8q

Bain Capital is raising a new middle-market credit fund, per SEC filings.

GGV Capital is raising upwards of $1.88 billion for several new funds, including its seventh flagship, per SEC filings. www.ggvc.com

Monument MicroCap Partners has been launched as an Indianapolis-based private equity firm focused on U.S. and Canadian companies with EBITDA of between $1 million and $5 million. The team includes several former members of Hammond, Kennedy Whitney & Co., including former CEO Glenn Scolnik. http://axios.link/5SWI

It's Personnel

Drew Maloney has joined the American Investment Council as president and CEO. He previously was assistant secretary for legislative affairs at the Treasury Department.

Robert Townsend, current co-chair of the global M&A practice group at law firm Morrison & Foerster’s, agreed to joined SoftBank as chief legal officer and SVP.

Edison Partners promoted James Hill, Jennifer Lee and Doba Parushev from senior associates to vice presidents. www.edisonpartners.com

Felicis Ventures promoted Dasha Maggio to partner (portfolio ops), Katie Riester to partner (IR) and Niki Pezeshki to principal. www.felicis.com

JMI Equity promoted both Krishna Potarazu and Vincent Prajka to partner. It also promoted Jackie Coombe, Melissa Guttman and Sureel Sheth to principal and Ryan Russell, Chase Thomet and Mac Williams to vice president. www.jmi.com

Final Numbers
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Adapted from an American Fedration of Teachers report; Note: General Dynamics’s core business is not operating private prisons, but is included because it has contracts with migrant shelters; Table: Axios Visuals
Dan Primack

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