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Archive for the ‘Distressed IP’ Category

“Maximizing Enterprise Value through Balance Sheet Restructuring & Date Certain M&A Process”

Posted in boic, Distressed IP, Intellectual capital, Marketing, tagged , , on November 9, 2009| Leave a Comment »

Gerbsman Partners has been involved with numerous national and international equity sponsors, senior/junior lenders, investment banks and equipment lessors in the restructuring or termination of various Balance Sheet issues for their portfolio companies. These companies were not necessarily in Crisis, had CASH (in some cases significant CASH) and/or investor groups that were about to provide additional funding. In order stabilize their go forward plan and maximize CASH resources for future growth, there was a specific need to address the Balance Sheet and Contingent Liability issues as soon as possible.

Some of the areas in which Gerbsman Partners has assisted these companies have been in the termination, restructuring and/or reduction of:

  • Prohibitive executory real estate leases, computer and hardware related leases and senior sub-debt obligations – Gerbsman Partners was the “Innovator” in creating strategies to terminate or restructure prohibitive real estate leases, computer and hardware related leases and senior and sub-debt obligations. To date, Gerbsman Partners has terminated or restructured over $790 million of such obligations. These 77 deals were a mixture of both public and private companies, and allowed the restructured company to return to a path of financial viability.
  • Accounts Trade payable obligations – Companies in a crisis, turnaround or restructuring situation typically have accounts and trade payable obligations that become prohibitive for the viability of the company on a go forward basis. Gerbsman Partners has successfully negotiated mutually beneficial restructurings that allowed all parties to maximize enterprise value based on the reality and practicality of the situation.

Date Certain M&A Process

Gerbsman Partners developed its proprietary “Date Certain M&A Process” in 2002. Since that time, the process has evolved into a 6 week plus time frame vehicle for maximizing enterprise and asset value for under-performing venture capital and senior lender backed medical device, life science and technology Intellectual Property based companies. To date, Gerbsman Partners has maximized enterprise and asset value for 60 portfolio companies. A description of this proven process can be reviewed on the Gerbsman Partners website.

About Gerbsman Partners

Gerbsman Partners focuses on maximizing enterprise value for stakeholders and shareholders in under-performing, under-capitalized and under-valued companies and their Intellectual Property. Since 2001, Gerbsman Partners has been involved in maximizing value for 60 Technology, Life Science and Medical Device companies and their Intellectual Property and has restructured/terminated over $790 million of real estate executory contracts and equipment lease/sub-debt obligations. Since inception in 1980, Gerbsman Partners has been involved in over $2.3 billion of financings, restructurings and M&A transactions.

Gerbsman Partners has offices and strategic alliances in Boston, New York, Washington, DC, Alexandria, VA, San Francisco, Europe and Israel.

For additional information please visit Gerbsman Partners website.

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IT Services In Sweet Spot As M&A Gathers Steam

Posted in Board Of Intellectual Capital, Business models, Distressed IP, Gerbsman Partners, Intellectual capital, Investments, Market research, Strategy, Venture Capital, tagged , , , , , , , on October 30, 2009| Leave a Comment »

Here is some possitive news from VC Circle.

“The ongoing recovery in the economy and credit markets has made tech companies look for ways to come out on top.

The U.S. information technology services sector is likely to be a focus of merger and acquisition activity as its companies are among the most attractive in the technology space.

A rebound in tech spending has increased the appeal of IT services companies and put them in the crosshairs as deal momentum picks up in the industry.

The ongoing recovery in the economy and credit markets has made tech companies look for ways to come out on top, and they have shown a willingness to pay hefty premiums in a sector that has historically commanded high prices.

IT services firms have a recurring revenue stream, high margins, a strong growth outlook and impressive returns on investment, making tempting targets for buyers. They offer consulting, software services, business process outsourcing, systems integration and interactive marketing.

Cash-rich technology giants plan to strengthen their portfolios, and smaller firms want to stay in the game through acquisitions as their larger rivals become even more formidable.

Attractive acquisition candidates include Sapient, Computer Sciences, WNS, Amdocs, Cognizant Technology and ExlService, analysts said.

Consolidation is under way. In September, Xerox Corp said it would buy Affiliated Computer Services Inc in a deal valued at about $5.5 billion, and Dell Inc said it planned to buy Perot Systems Corp for about $3.9 billion.

“The pattern here is that you have commoditizing tech product companies looking for a strategy that’s better than doing nothing,” Sanford C. Bernstein analyst Rod Bourgeois said.

“They’re looking at the IT services industry to juice up their struggling tech product business.”

Possible acquirers could be tech giants such as IBM, Hewlett-Packard or Cisco, European players like BT or Deutsche Telekom and Asian companies like Hitachi, Fujitsu or NEC, analysts said.

“There’s definitely going to be some strategic acquisitions — there’s no doubt about that,” Goldman Sachs analyst Julio Quinteros said. “It’s just, how much are you willing to pay? And would you rather wait for the market to come back a little bit?”

The recurring revenue stream that IT services firms have gives them more visibility and stability.

“What’s driving a lot of this is the evolution of hardware companies looking for more stability and recurring revenues that are typically associated with services models and by the same token software companies potentially looking for the same thing,” Quinteros said.

Hardware and software companies want to diversify their portfolios by adding services, to help them survive and even prosper through tough times.

“What’s alluring about services for tech product companies is first the precedent of IBM and HP coupling products with services to be able weather the downturn well,” Bourgeois said.

In 2008, Hewlett-Packard acquired EDS for $13 billion in what is considered the biggest acquisition in the space ever. In 2002, IBM bought PwC Consulting from PricewaterhouseCoopers for about $3.5 billion.

“Vendors are trying, to some extent, to emulate the integrated model that IBM really pioneered when they got into the services business years ago,” UBS analyst Jason Kupferberg said. “HP followed suit buying EDS. Now you’re seeing a continuation of that theme.”

Read the full article here.

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DATE CERTAIN M&A OF ASSETS OF OMNISONICS MEDICAL TECHNOLOGIES, INC.

Posted in Board Of Intellectual Capital, Distressed Intellectual Property, Distressed IP, Gerbsman Partners, Investments, Life Science, Technology, Venture Capital, tagged , , , , , , , , , , , , , , on October 9, 2009| Leave a Comment »

SALE OF ASSETS OF OMNISONICS MEDICAL TECHNOLOGIES, INC.

INTRODUCTION
Gerbsman Partners (www.gerbsmanpartners.com) has been retained by Emigrant Bank (“Emigrant”) to solicit interest for the acquisition of all, or substantially all, assets of OmniSonics Medical Technologies, Inc. (“OmniSonics”).  OmniSonics was a leader in commercializing technology that uses ultrasound technology to break up blood clots. A copy of the proposed purchase agreement is attached as Exhibit A, as well as a confidential information memorandum and related documents.  A Purchaser who wishes to participate in the auction must submit a sealed bid which is actually received by Emigrant no later than Friday, November 6, 2009 (the “Bid Deadline”).

The assets of OmniSonics are attractive for a number of reasons:

· FDA approved product indicated for the removal of thrombus in the peripheral vasculature and the infusion of physician specified fluids.
· Intellectual Property: a comprehensive patent estate which includes 20 issued patents and 16 pending patent applications in the U.S., as well as 6 issued patents and 13 pending patent applications outside of the U.S. Many of the key patents which cover apparatus, methods and uses do not expire until 2022.  A list of the intellectual property is attached as Exhibit B.
· Preliminary Prospective, Registry Patient Data Set for removal of thrombus in patients with Deep Vein Thrombosis (DVT) Sonic I.
· Preliminary Prospective, Registry Patient Data Set for removal of thrombus in patients with Acute Limb Ischemia) Sonic II.
· Manufacturing, Design and Calibration Equipment.
· Relationships with Third Party Manufacturers that can assist with the production of saleable product.

OmniSonics  Company Profile

Founded in 1999, OmniSonics was a private, Wilmington, MA-based revenue stage medical device company. Over the past 10 years, OmniSonics raised approximately $100MM in equity and debt from leading venture capital firms including GE Asset Management, Nomura Phase4 Ventures, Domain Associates, H&Q Asset Management and Canaan Partners.

Bankruptcy Case. On March 23, 2009, OmniSonics filed a chapter 7 bankruptcy case in the United States Bankruptcy Court for the District of Massachusetts.  John J. Aquino is Trustee. Emigrant’s affiliate, Life Sciences Capital, LLC, was a prepetition lender to OmniSonics and Emigrant has entered into a transaction with the Trustee to purchase substantially all of the assets of OmniSonics, including its intellectual property. Emigrant has retained Gerbsman Partners to conduct a sale of these assets.  Some of the former employees of OmniSonics may be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership. Notwithstanding the foregoing, former employees or officers of OmniSonics and the Trustee should not be contacted directly without the prior consent of Gerbsman Partners.

Assets Being Sold. The assets which are being sold consist of substantially all of the intellectual property of OmniSonics including issued patents and trademarks, related records, patent applications, and certain equipment.   These are referred to as the “Assets.”

IMPORTANT LEGAL NOTICE

The information in this memorandum does not constitute the whole or any part of an offer or contract.

The information contained in this memorandum relating to the Assets has been supplied by former executive officers of OmniSonics and the Trustee. It has not been independently investigated or verified by Gerbsman Partners or their respective agents.

Prospective purchasers should not rely on any information contained in this memorandum or provided by Gerbsman Partners (or their respective staff, agents, and attorneys) in connection with the proposed sale, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties must satisfy themselves through independent investigations and due diligence as they see fit.

Gerbsman Partners, and their respective staff, agents, and attorneys: (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection with the proposed sale and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of OmniSonics’ or Gerbsman Partners’ negligence or otherwise.

Any sale of the OmniSonics Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of OmniSonics, Gerbsman Partners, Emigrant or the Trustee. Without limiting the generality of the foregoing, the foregoing parties and their respective staff, agents, and attorneys,  hereby expressly disclaim any and all implied warranties concerning the condition of the Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

Please refer in the Confidential Information Memorandum to the section on Legal Considerations for further information about these matters, and the section on Bidding Procedures for information about bidding procedures.


BIDDING PROCEDURES

1. Each person or entity who is or may be interested in bidding for and purchasing all or some of the Assets shall be referred to as “Purchaser.” Each Purchaser who executes the Confidentiality Agreement may request access to former personnel of OmniSonics who may be made available and access to the “Data Room” which includes various documents (the “Diligence Access”).  Any Purchaser seeking access to OmniSonics personnel or who wishes to request additional information should contact Gerbsman Partners.  Each Purchaser who executes the Confidentiality Agreement and obtains the Diligence Access (whether or not such Purchaser has obtained all or some portion of the personnel and access materials) shall be deemed to acknowledge and represent:  (a) that it is bound by the bidding procedures described herein; (b) that it has had an opportunity to inspect and examine the Assets and to review pertinent documents and information with respect thereto; (c) that it is not relying upon any written or oral statements, representations, or warranties of Gerbsman Partners or Emigrant; and (d) all such documents and reports have been provided solely for the convenience of the interested party, and Gerbsman Partners and Emigrant do not make any representations as to the accuracy or completeness of the same.

2. A Purchaser who wishes to participate in the auction must submit a sealed bid, which is to be received by Emigrant no later than Friday, November 6, 2009 (the “Bid Deadline”), to Karen Wold, Emigrant Bank, 6 East 43rd Street, 20th Floor, New York, New York 10017 and e-mailed to:  Woldk@emigrant.com and steve@gerbsmanpartners.com.  The bid shall contain:  (a) a list or identification of the Assets such Purchaser wishes to purchase; (b) the amount of the bid; (c) any proposed changes to the Purchase Agreement and all exhibits and schedules, with redline to show all such changes and (d) any other information that Purchaser deems relevant.  All bids must be accompanied by a refundable deposit check in the amount of $50,000 (payable to Emigrant).

In addition:

(a) Bids may be made for all or any portion of the Assets.

(b) Any Purchaser making a bid must be prepared to provide independent confirmation that it possesses the financial resources to complete the purchase.

(c) Emigrant reserves the right to, in its sole discretion, extend the Bid Deadline, accept or reject any bid, or withdraw any or all Assets from the sale.

(d) Emigrant shall determine the highest and best bid and may contact Purchasers regarding their bids prior to the final determination.  The winning bidder will be notified as soon as possible after the Bid Deadline. Unsuccessful bidders will have their deposits returned to them.

(e) A successful Purchaser with regard to some or all of the Assets will be required to increase its deposit to $200,000 within 24 hours of being notified it is a successful Purchaser and be prepared to close within seven (7) days of being notified that its bid has been accepted. All sales, transfer, and recording taxes, stamp taxes, if any, relating to the sale of the Assets shall be the sole responsibility of the successful bidder and shall be paid to Emigrant at the closing of each transaction.  If the successful bidder fails to close, Emigrant may retain the deposit, exercise any remedies under applicable law and subsequently sell to another party.

(f) Any Purchaser who bids shall have no remedy against Emigrant or Gerbsman Partners or any other person except for the return of its deposit; provided, that, any Purchaser who enters into an Asset Purchase Agreement shall have all remedies under such Agreement and under applicable law.

(g) Copies of all bids should be sent by e-mail to steve@gerbsmanpartners.com

CONTACTS

For additional information, please do not contact OmniSonics or the Trustee directly; instead please contact:

For additional information, please see below and/or contact:

Steven R. Gerbsman
(415) 456-0628
steve@gerbsmanpartners.com

Dennis Sholl
(415) 457-9596
dennis@gerbsmanpartners.com

Kenneth Hardesty
(408) 591-7528
ken@gerbsmanpartners.com

Other covering this topic include: Xconomy, Taragana.

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Sequoia Communications shutting down

Posted in Board Of Intellectual Capital, Distressed Intellectual Property, Distressed IP, Gerbsman Partners, Market research, Mobile, Technology, Venture Capital, tagged , , , , , , on August 21, 2009| Leave a Comment »

Here is an excellent article from the VC dispatch at Wall Street Journal.

“Though demand for mobile phones is at an all-time high, Sequoia Communications Inc., a developer of components for the devices, has found itself unable to raise additional venture capital and is closing its doors, according to an investor.

The San Diego company had raised about $64 million from nine venture firms over several rounds beginning in 2001, VentureWire records show.

Luis Arzubi, a general partner with Tallwood Venture Capital, which participated in three funding rounds for Sequoia, said the company felt the pinch from the world’s economic slowdown, competition from name-brand tech companies and the difficulty of keeping the company’s components in compliance with the rules and protocols of numerous overseas markets.

“The company was running behind its original schedule,” Arzubi said. “Venture capitalists are very cautious, and afraid of throwing good money after bad.”

The company developed a transceiver for mobile phones that worked well, he said, and had signed up customers. Sequoia was about a year away from breaking even when investors pulled the plug, he said.

Transceivers are one of many electronic components that enable wireless communication. They are capable of tuning in, modulating and broadcasting standard cell signals. Transceivers also exist in other electronics and are used to pick up and broadcast other types of signals.

Semiconductor giants such as Qualcomm Inc. and Infineon Technologies AG also build transceivers, and they have more resources to bring to bear on the process, Arzubi said. They also have a diversified line of products, which Sequoia did not.”

Read the fulla article here.

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Successful “Date Certain M&A” of Business Unit and its Assets and Intellectual Property

Posted in Board Of Intellectual Capital, Distressed Intellectual Property, Distressed IP, Gerbsman Partners, Investments, Strategy, Venture Capital, tagged , , , , , , on August 13, 2009| Leave a Comment »

Steven R. Gerbsman, Principal of Gerbsman Partners, Kenneth Hardesty, Merle McCreery and Dennis Sholl, members of Gerbsman Partners Board of Intellectual Capital, announced today their success in maximizing stakeholder value for a venture capital backed online marketing solutions company, specializing in lead generation and customer acquisition.

Gerbsman Partners provided Crisis Management leadership, facilitated the sale of the business unit, associated Intellectual Property and assets and recovered receivables. Due to market conditions, the senior lender and the board of directors made the strategic decision to maximize the value of the business unit and Intellectual Property.

Gerbsman Partners provided leadership to the company with

  • Crisis Management and technology expertise in developing the strategic action plans for maximizing value of the business unit, Intellectual Property and assets;
  • Proven domain expertise in maximizing the value of the business unit and Intellectual Property through a targeted and proprietary “Date Certain M&A Process”;
  • The ability to “Manage the Process” among potential Acquirers, Lawyers, Creditors Management and Advisors;
  • The proven ability to “Drive” toward successful closure for all parties at interest.

About Gerbsman Partners

Gerbsman Partners focuses on maximizing enterprise value for stakeholders and shareholders in under-performing, under-capitalized and under-valued companies and their Intellectual Property. Since 2001, Gerbsman Partners has been involved in maximizing value for 56 Technology, Life Science and Medical Device companies and their Intellectual Property and has restructured/terminated over $770 million of real estate executory contracts and equipment lease/sub-debt obligations. Since inception in 1980, Gerbsman Partners has been involved in over $2.2 billion of financings, restructurings and M&A transactions.

Gerbsman Partners has offices and strategic alliances in Boston, New York, Washington, DC, Alexandria, VA, San Francisco, Europe and Israel.

For additional information please visit www.gerbsmanpartners.com

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