Feeds:
Posts
Comments

Posts Tagged ‘Date Certain M&A’

Treasury proposal could shut down smaller firms

Posted in Uncategorized, tagged , , , , , , , , , , on July 29, 2009| Leave a Comment »

Here is a thought provoking article from PiOnline.

“Proposed registration, reporting and disclosure laws for alternatives managers — likely to be passed by Congress before year end — could force a swath of smaller managers to close and could have a devastating impact on hedge funds of funds, sources say.

Hedge fund, private equity and venture capital managers and their lobbyists want to strike a deal with legislators to lessen the administrative burden of reporting all investment and trading positions, trading practices, assets and on- and off-balance sheet risks, as is now proposed by the Treasury Department.

“The proposal’s required administrative tasks would be very burdensome for venture capital firms, which tend to be small companies. The chief financial officers in these firms already tend to be very stretched with the existing job of running the firm. I think this proposal … could drive many smaller venture capital firms out of business,” said Emily Mendell, a spokeswoman for the National Venture Capital Association, Washington.

“Smaller hedge fund, private equity and venture capital managers will be disproportionately impacted by the reporting regulations,” agreed Daniel Celeghin, director, Casey Quirk & Associates LLC, Darien, Conn.

“The real panic I’m hearing is from hedge funds of funds, whose executives say the reporting requirements will be a huge problem because they don’t get this level of detail from their underlying managers in order to be able to pass it on to the SEC. They’ve said `What’s coming could sink us,’ ” Mr. Celeghin said.

The new investment manager requirements are part of the Obama administration’s financial reform package first floated in June and designed to increase oversight of systemic risk and to control it.”

Read the full article here.

Read Full Post »

Khosla’s Clean Tech VC Fund Beats the Odds, Raises $1bn

Posted in Board Of Intellectual Capital, boic, Business models, Gerbsman Partners, Intellectual capital, Investments, Market research, Strategy, Venture Capital, tagged , , , , , , , , , , , , , on July 24, 2009| Leave a Comment »

Here is a possitive article from Green Energy Reporter.

“A widely used catch phrase – or some variation of it – appearing in the media since the official start of the crisis this fall,  goes something like this: “the global economic crisis, has left the [add required sector, in our case clean tech] reeling, unable to tap crucial funding…. ” This generic phrase and its variations have been used over and over to describe a harsh reality, specifically  how the credit crunch has left industries across the board at a standstill, unable tap financing to support their growth.

Then there is Khosla Ventures, the Sand Hill Road clean tech-focused venture fund, which will be announcing sometime this week the closing of two funds totalling $1 billion, all dedicated to supporting early clean tech investments. This is impressive, considering that most don’t expect this sort of capital raising to happen until well into 2010.

But it seems that Khosla Ventures, founded by Silicon Valley veteran Vinod Khosla, can afford shortcuts.  For one,  Khosla is a co-founder of Sun Microsystems and a former partner at Kleiner, Perkins, Caufield & Byers, two leading Silicon Valley pioneers. Also, back in 2004, when clean tech was an afterthought and social media  à la MySpace was all the rage,  he launched Khosla Ventures, one of the sector’s first clean-tech focused VC fund.

Forbes.com reports Khosla is on the verge of announcing two new funds: a $250 million vehicle for seed-stage investments and a $750 million fund for larger deals dubbed “KVIII.” One fund has closed already, and the other could close soon, Forbes reports, citing people with knowledge of the funds. Khosla himself is expected to invest $150 million of his own money in the new funds. Other reported investors include CalPERS, the pension giant with $179.2 billion in assets.”

Read the full article here.

Read Full Post »

Dell looking for acquisitions; data storage experts scope out the candidates

Posted in Board Of Intellectual Capital, boic, Business models, Economy, Gerbsman Partners, Investments, Strategy, Venture Capital, tagged , , , , , , , , , , , , on July 22, 2009| Leave a Comment »

Here is an excellent article from SearchStorage.com.

“Dell Inc. executives this week repeated their claims that the vendor is looking for acquisitions, without giving much hint about who’s on the shopping list. But data storage figured prominently in Dell’s analyst day presentations on Tuesday, and execs pointed to EqualLogic as a model acquisition.

Founder and CEO Michael Dell hailed EqualLogic for its solid technology, and said revenue from its iSCSI storage systems has grown four times since Dell acquired it in early 2008.

Dell also said any acquisition target would have to fit into the vendor’s channel sales strategy, be easy to integrate and have financial stability with good profit margins. Dell hasn’t specifically limited its acquisition talk to data storage, and RBC Capital Markets analyst Amit Daryanani wrote in a note to clients, “We do not believe investors received a firm idea of how this might unfold at the analyst day. Management vaguely indicated it would likely look to do a ‘portfolio’ of acquisitions that would augment its penetration in favorable submarkets.”

Nonetheless, Dell’s statements about looking to expand through “inorganic growth” and move deeper into the enterprise and data center is sparking speculation about what companies would be likely candidates. “Given the data presented, we would not be surprised if targets were found in services and software given anticipated near-term annual growth rates of 6% and 8%, respectively,” Daryanani wrote in his note.

Industry insiders are drawing up lists of storage companies that fit Dell’s criteria and might help the vendor expand. Here are some of their candidates:

3PAR Inc.

The high-end disk array vendor’s growth took a hit this week when 3PAR said it expects to report a sequential revenue decline for last quarter. However, analysts see 3PAR as a good technology fit for Dell.

“3PAR would fit nicely into their portfolio,” said Jeff Boles, senior analyst and director of validation services at Hopkinton, Mass.-based Taneja Group. “[Dell] already has the small and medium enterprise and entry-level markets pretty well covered. Their opportunity is to expand their footprint up market.”

3PAR’s InServ Storage Server systems compete with EMC Corp.’s Symmetrix, as well as with systems at the high end of the Clariion platform, which Dell resells. But competing with partner EMC didn’t stop Dell from buying EqualLogic, which competes against the lower end Clariion models.

CommVault Systems Inc.

In a Q&A with SearchStorage.com last year, Dell storage vice president and general manager Darren Thomas downplayed the idea of buying a storage software vendor. But CommVault has the profitability, high margins and recurring revenue streams that Dell wants. It’s also a Dell partner. Boles sees similarities to where CommVault is as a company and where EqualLogic was when Dell picked it up for $1.4 billion. “Dell has tended to buy someone with revenue ramping pretty aggressively,” he said.”

Read the full article here.

Read Full Post »

When a takeover battle goes nuclear

Posted in Board Of Intellectual Capital, Business models, Distressed IP, Economy, Intellectual capital, Investments, Market research, Strategy, Venture Capital, tagged , , , , , , , , on July 9, 2009| Leave a Comment »

Here is a good reflective article from CNN on the art of mergers – and it´s possible pitfalls.

“(Fortune Magazine) — David Crane, CEO of NRG Energy and a father of five, was standing in a stubby cornfield in Bucks County, Pa., one windy evening last October when his BlackBerry began to stir. He checked his in-box, but he didn’t respond, not right away. It was Sunday night, and he was on an outing with his family, waiting in line for a Halloween hayride. Nor did he respond an hour later on his way to the Amtrak station to catch a train to Washington, D.C. How could he, when he drives a Mini Cooper with a stick shift? You need both hands to manage a car like that. So it wasn’t until after nine at night, having found a quiet corner of the waiting room behind a Dunkin’ Donuts kiosk, that Crane finally got around to calling back John Rowe.

Rowe, CEO of Exelon Corp. (EXC, Fortune 500), picked up Crane’s call at his big-windowed aerie in Chicago’s Chase Tower, 54 stories above the Loop. Rowe told Crane that his board had met that afternoon, and he had some news: Exelon, the country’s biggest electric utility, was hereby offering to buy NRG (NRG, Fortune 500), the country’s fastest-growing independent electricity merchant — it sells wholesale power to utilities — for stock in a deal worth $6.2 billion. Term sheet to follow, press release within the hour. “Offer” was a euphemism; this was a hostile act.

Crane was stunned, less by Rowe’s uninvited bid (his lust for NRG was no secret) than by his choosing to publicize it instantly. Protocol dictates that a classic bear hug, as the M&A world defines the ritual, begin with a warm embrace, in private, with an eye toward achieving mutual consent. Rowe wasn’t even pretending to be nice. Crane could imagine why. NRG was secretly pursuing two deals of its own with Houston-based power companies: one code-named Doris, for Dynegy (DYN), the other Rodeo, for Reliant. Either would create regulatory obstacles that could block Exelon. Somehow Rowe had gotten wind of them. Neither was imminent, Crane says now (“He had a lot more time”), but Rowe didn’t know that.

Their conversation lasted only a few minutes. Crane asked Rowe if he had his debt financing in place. Both men understood that a change of control would trigger an immediate requirement to pay down $8.5 billion in NRG loans. “Not yet,” said Rowe, “but we’re working on it.” Crane wanted nothing to do with this deal: not with Rowe, whom he barely knew; not with Exelon, which he views as stodgy, bureaucratic, and otherwise “ill suited” to run an entrepreneurial enterprise like NRG without “suffocating” it; and definitely not at that price, which he would soon be describing to anyone who would listen as tantamount to “stealing the company.” Nevertheless, he tried to be civil as he concluded the call, promising Rowe, “We’ll give this serious consideration.”

So much for his scheduled trip to Washington. Crane called Jonathan Baliff, NRG’s M&A specialist, and reached him at home. “You’re not gonna believe this,” he said, still not quite believing it himself. “John Rowe just called to wish me a happy Halloween.”

Click here for the whole article.

Read Full Post »

Lean times continue for startups, as sales, IPOs wither

Posted in Board Of Intellectual Capital, Business models, Economy, Gerbsman Partners, Investments, Strategy, Technology, Venture Capital, tagged , , , , , , , , , , , , , , , , , , , , , , , on July 8, 2009| Leave a Comment »

Here is an excellent Bloomberg article by way of statesman.com.

“SAN FRANCISCO — Acquisitions of startups fell to the lowest level in a decade in the second quarter as the recession stopped companies from buying smaller competitors.

A total of 59 startups merged with other companies, a drop of 30 percent from a year earlier and dropping to the lowest level since 1999, the National Venture Capital Association said. Five U.S. startups have had initial public offerings so far this year. In 2007, before the financial crisis, there were 86.

Acquisitions and IPOs — the two ways for venture capitalists to cash in their investments — have almost come to a standstill, NVCA President Mark Heesen said. With the IPO market struggling, larger technology companies — confident that prices will fall — are waiting before proposing takeovers, he said.

“The buyers on the merger and acquisition side got smart real fast,” Heesen said. “They wait for companies to come crying to them to get bought.”

No venture-backed companies went public between September and March — the longest slump since the association began collecting data in 1971. Only 11 startups have had IPOs since the end of 2007, and there is little immediate prospect for improvement, said Paul Bard, an analyst at Renaissance Capital.

Only 10 startups have filed pre-IPO paperwork with U.S. regulators, and none has done so since January, said Emily Mendell, an NVCA vice president. That signals that deals such as the May IPOs of Austin-based SolarWinds Inc. and online restaurant-reservation service OpenTable Inc. failed to spur other young companies to act.

It also means the market won’t revive in the next few months, Bard said.

“Unless filing activity spikes in the next two to three weeks, we’re unlikely to see a more sustainable pickup in VC-backed IPOs before Labor Day,” Bard said. “The bar will remain high for most VC-backed deals to get done.”

Even if the 10 biggest venture capitalists had 25 companies ready to go public by early next year, that would still leave IPOs at about a third of their levels from 2004 to 2007, he said.

That means startups lack bargaining power in merger talks, a situation that is keeping offers low and stalling many negotiations that do occur, Heesen said.

Only 13 of the 59 companies that sold out reported how much they were paid, the association said. Prices were higher than in the first quarter, a possible sign of improving conditions later this year, it said.

Cisco Systems Inc.’s $590 million deal to buy Pure Digital Technologies Inc., maker of the Flip Video camera, helped drive up the average merger price to $197.7 million.

Five companies commanded less than venture capitalists had invested, the venture capital association said. Purchases of medical-instrument makers CoreValve Inc. and Chestnut Medical Technologies Inc. were the only ones in which early backers received 10 times their outlay, the traditional standard for a venture-capitalist home run, Mendell said.”

Read the full article here.

Read Full Post »

« Newer Posts - Older Posts »