Direct
Economic concerns and tight credit markets contributed to a 17% drop in merger and acquisition deal volume within the marketing, information and digital sectors during second-quarter 2009, when compared with the first quarter.
The 150 transactions tracked by investment firm Petsky Prunier totaled $2.4 billion, a transaction dollar drop of 6%. Petsky Prunier's calculations exclude WebMD's merger with its parent company, HLTH Corp., in a transaction valued at approximately $1.3 billion.
Among entities making purchases, strategic buyers remained more active than private equity firms and accounted for the largest portion of overall investment with 69 transactions (46% of total) worth an estimated $1.3 billion. Including both control and minority investments, financial buyers accounted for 54% of deal volume and 46% of dollar volume in the quarter.
Interactive advertising was the quarter's most active segment, with 38 transactions and approximately $439 million in value. Battery Ventures and Scale Venture Partners' $70 million investment in ExactTarget, an on-demand email and one-to-one marketing solutions provider was the largest transaction, accounting for 16% of the segment's aggregate dollar volume.
Interest in mobile advertising, a subsegment of Interactive Advertising, continued with 14 deals during the quarter worth approximately $73 million.
Digital Media was the second most active segment in 2Q09 with 37 transactions worth approximately $607 million. Two subsegments within digital media, user'generated content (UGC)/social media and niche content, continued to attract venture and growth capital investment, as consumer appetite for proprietary and unique content continues to grow.
Notable UGC/social media transactions included Digital Sky Technologies' $200 million investment in Facebook, valuing the company at approximately $10 billion, Canaan Partners' $6 million investment in Associated Content and Allen & Company's $5.3 million investment in Gather.com.
Niche content companies accounted for seven acquisitions and five investments, including Barclays Capital's acquisition of Bounty Group for $79 million, Sequoia Capital's $16 million investment in Sugar, America Online's acquisition of Patch Media and Going.com and Azure Capital Partners' $7 million investment in BlogHer.
Within the marketing technology segment, the content management subsegment was the most active with five transactions this quarter for approximately $181 million. Representative transactions included Open Text's acquisition of Vignette for $160 million and OutStart's acquisition of Hot Lava Software.
The Software and Information segment saw six acquisitions and two investments in the market research subsegment. Notable transactions included Spectrum Equity and Bain Capital Ventures' acquisition of SurveyMonkey, InfoUSA's divestiture of Macro International to ICF Consulting for $155 million, S&P's sale of Vista Research to Guidepoint Global and Microsoft's sale of Greenfield Online's Internet Survey assets to ToLuna for $40 million.
Among buyers and investors, venture and growth capital investors accounted for the largest portion of total deal volume during the second quarter, with 76 transactions (51% of total) worth an estimated $890 million. Draper Fisher Jurveston was the most active financial investor among Marketing, Information and Digital Media targets, announcing two investments this quarter and six investments overall in 2009. Additionally, Foundry Group, Foundation Capital, Clearstone Venture Partners, Catalyst Investors, Canaan Partners and Accel Partners each announced two transactions during the quarter.
Strategic buyers accounted for the majority of control transactions during the quarter, although many of these deals were small. Strategics acquired 69 companies for a total of $1.3 billion. America Online, Time Warner and Amazon.com were the most active strategic buyers, consummating two transactions each.
Private equity firms continued to face hurdles financing large leveraged buyouts. During the second quarter, private equity buyout firms completed five deals, up from three transactions in 1Q09. In addition to Barclay's acquisition of Bounty Group, other private equity transactions included LLR Partners' acquisition of I'many, a contract management software provider, for $23 million, and ZM Capital and Palladium Equity Partners' majority investment in Cannella Response Television, a direct response television media services company, which was supported by mezzanine financing provided by VSS Structured Capital Fund.
"While the deal market continues to be challenging, transactions are still being completed," John Prunier, partner at Petsky Prunier said in a statement. "Venture and growth investment is the relative sweet spot in the market, but with exit horizons generally longer and lower in value than they were when many funds were raised, liquidity and terms are still not as expansive as they have been or, we believe, will be again. Similarly, with credit markets remaining tight, leveraged buyouts remain largely beyond the grasp of their private equity sponsors."
Yahoo! Finance
Award Recognizes Entrepreneurial Excellence in Services Category
NORTH HOLLYWOOD, Calif., June 25 /PRNewswire-FirstCall/ -- IPC The Hospitalist Company, Inc. (Nasdaq: IPCM - News), a leading national hospitalist physician group practice company, today announced that CEO, Adam Singer, M.D., received the Ernst & Young Entrepreneur Of The Year® 2009 Award in the services category in the Greater Los Angeles Area. According to Ernst & Young LLP, the award recognizes outstanding entrepreneurs who are building and leading dynamic, growing businesses. Dr. Singer was selected by an independent panel of judges, and the award was presented at a gala event at the Beverly Hilton Hotel on June 23, 2009.
"I'm honored to have been named the Ernst & Young Entrepreneur Of The Year in the Los Angeles area in the services category," said Dr. Singer. "With healthcare reform so prominent on the national agenda, IPC's business model offers hospitals a proven way to provide high quality care to hospitalized patients in an efficient and cost-effective manner."
The Ernst & Young Entrepreneur Of The Year awards celebrate their 23rd anniversary this year. The program honors entrepreneurs who have demonstrated exceptionality in such areas as innovation, financial performance and personal commitment to their businesses and communities.
"We are proud to recognize the achievements of Dr. Singer and IPC," said Brian Ring, Ernst & Young LLP Entrepreneur Of The Year Program Director for the Greater Los Angeles Area. "Winners of the Entrepreneur Of The Year award build leading businesses and contribute significantly to the strength of our region's economy. Their success helps our area grow stronger."
As a Greater Los Angeles award winner, Dr. Singer is now eligible for consideration for the Ernst & Young LLP Entrepreneur Of The Year 2009 national program. Award winners in several national categories, as well as the overall national Ernst & Young Entrepreneur Of The Year award winner, will be announced at the annual awards gala in Palm Springs, California on November 14, 2009.
About IPC The Hospitalist Company, Inc.
IPC The Hospitalist Company, Inc. (Nasdaq: IPCM - News) is a leading national physician group practice company focused on the delivery of hospitalist medicine services. IPC's physicians and affiliated providers manage the care of hospitalized patients in coordination with primary care physicians and specialists. The Company provides its hospitalists with the comprehensive training, information technology, and management support systems necessary to improve the quality and reduce the cost of inpatient care in the facilities it serves. For more information, visit the IPC website at www.hospitalist.com.
About Ernst & Young's Entrepreneur Of The Year® Awards Program
Ernst & Young's Entrepreneur Of The Year® Award is the world's most prestigious business award for entrepreneurs. The award makes a difference through the way it encourages entrepreneurial activity among those with potential and recognizes the contribution of people who inspire others with their vision, leadership and achievement. As the first and only truly global award of its kind, the Ernst & Young Entrepreneur Of The Year® award celebrates those who are building and leading successful, growing and dynamic businesses, recognizing them through regional, national and global awards programs in more than 135 cities in 50 countries.
Xconomy
By Juha-Pekka Tikka
Three San Diego-based biopharmaceutical startups have been raising capital, according to recent filings with the U.S. Securities and Exchange Commission (SEC).
Valor Medical, which was founded in 2007, has raised $3.1 million of an $8 million offering, according to a recent SEC filing. CEO H. Clark Adams says this is a partial close of a Series B round, the investors were individuals, and the company expects to have a final close by the end of the month. Valor is developing a treatment for a brain aneurysm that is administered through a microinfusion catheter. According to Clark, the funds will be used for completing requirements for their mandatory European conformity mark, scaling up for commercial launch in Europe next year, and beginning U.S. clinical trials. Valor was founded by UC San Diego Radiology & Neurosurgery Professor Charles Kerber, who serves as its president.
Tocagen, which is developing gene therapy treatments for terminally ill cancer patients, has raised $10.8 million in an $11.2 million equity offering that began in September, according to its regulatory filing. Tocagen was founded in 2007 by Harry Gruber, a San Diego serial entrepreneur who previously founded local biotechs Gensia Pharmaceuticals, Viagene, Aramed, and Metabasis, Inc. Gruber also founded Intervu, a San Diego Internet media startup acquired in 2000 by Akamai Technologies in a deal valued at $2.8 billion, and Kintera, which provided Web-based software used by non-profit organizations to raise funds. Neither Gruber nor Tom Darcy, Tocagen’s chief financial officer, responded to email queries seeking information. According to information on Tocagen’s website, the startup is developing treatments for two deadly types of cancers, glioblastoma multiforme (a type of brain tumor), and malignant melanoma (a type of skin cancer).
Zogenix, which was founded in 2006 and was previously known as SJ2 Therapeutics, is raising $3.1 million through a combination of debt, warrants, and securities, according to a recent SEC filing. Zogenix is a specialty pharmaceutical startup developing two drug candidates for treating central nervous system disorders and pain. According to the Zogenix website, current investors are Abingworth Management, Clarus Ventures, Domain Associates, Scale Venture Partners, Thomas, McNerney & Partners, Life Science Angels, and Windamere Venture Partners. Chairman and co-founder Cam Garner has founded six other specialty pharmaceutical companies.
The following is a roundup of selected companies that have revealed fund-raising activity in recent Form D regulatory filings. These companies are required to file a Form D notification within 15 days after the first sale of securities in an offering. The filings do not list the investors who purchased shares in the offerings. However, they do list board members, so in cases where new investors have surfaced, we will report them below.
Zogenix Inc., San Diego, a specialty pharmaceutical company that pulled its registration for an initial public offering in August, has raised $3.1 million in debt, rights and securities. Zogenix raised an $18 million loan facility in late July through Oxford Finance Corp. and CIT Healthcare LLC. The company previously raised $78 million in Series A funding through two tranches. Its major shareholders include Abingworth Bioventures, Clarus Lifesciences, Domain Associates, Scale Venture Partners and Thomas McNerney & Partners. Life Science Angels also previously invested.