Term Sheet — Monday, October 10
Greetings from the home office, where E is busily preparing to march in a local parade. Some very quick notes, before I head out to watch the adorableness.
[ts_bullet_primary] Answer Key: On Friday I asked you name the head of private equity at a major public university who is leaving to join a private foundation as chief investment officer? Your hint was that it's a West Coaster who wasn't always a West Coaster.
The answer was Tim Recker, currently managing director of private equity and real assets at the University of California Regents (and onetime director of alternatives for the Michigan Retirement System). After more than nine years with UC, Recker is becoming CIO at The James Irvine Foundation, a San Francisco-based nonprofit with just north of $2 billion in assets under management (around half of which are in invested in venture capital and private equity).
[ts_bullet_primary] Debate points: The issue of carried interest taxation was raised last night by Donald Trump, when asked by an audience member about "what specific tax provisions will you change to ensure the wealthiest Americans pay their fair share in taxes?" Carry was the only specific Trump gave, adding that: (1) Hillary Clinton is "leaving" the carried interest treatment as is because it's "very important" to her Wall Street donors. (2) It is "one of the greatest provisions for people like me."
The first one is just incorrect, as Clinton has explicitly called for changing the tax treatment of carried interest. Moreover, the differing personal income tax plans of each candidate (Trump would lower top rates, Clinton would effectively raise them) means that Trump's plan would actually be more favorable to the "Wall Street donors" who currently benefit from carry. As for the second, I need to research it further but am not sure it's possible to find definitive answers without Trump's tax returns. Plenty of real estate developers do create partnerships that include carried interest provisions - something which few people take into account when adding up the federal revenue of a carry change - but it's unclear if Trump is among them.
It's also worth noting that neither candidate, nor the moderators, explained what carried interest actually is.
[ts_bullet_primary] Speaking of presidential politics: I've reached out to both Peter Thiel and his spokesman to see if the vile Access Hollywood tape has affected his presidential endorsement, but neither has replied.
THE BIG DEAL
[ts_bullet_primary] Atairos has agreed to acquire Learfield Communications, a Jefferson City, Mo.-based sports marketing company, from Providence Equity Partners. No financial terms were disclosed, although earlier reports suggested that the deal could be worth around $1.3 billion. Losing bidders included Thomas H. Lee Partners, TPG Capital and New Mountain Capital.
Atairos is an independent Comcast-backed fund led by Michael Angelakis, the former Comcast CFO who once was a senior executive with Learfield seller Providence Equity. www.learfieldsports.com
VENTURE CAPITAL DEALS
[ts_bullet_primary] Snapp, an Iranian ride-sharing app, has raised EUR20 million in Series A funding from South African mobile telecom company MTN. Read more.
[ts_bullet_primary] Eve Sleep, a London-based mattress e-tailer, has raised $18.3 million in Series B funding. Woodford Investment Management led the round, and was joined by Octopus Investments, Channel 4 and DN Capital. www.evemattress.com
[ts_bullet_primary] OncoResponse, a Houston-based immuno-oncology antibody discovery startup, has raised $7 million in new Series A funding from GreatPoint Ventures and Helsainn Investment Fund. www.oncoresponseinc.com
[ts_bullet_primary] SoundTrap, a Sweden-based music and audio recording platform in the cloud, has raised $6 million in Series A funding led by Industrifonden. Read more.
[ts_bullet_primary] Hooch, a membership-based cocktail and nightlife app, has raised $1.5 million in new seed funding led by Blue Scorpion Investments. www.hooch.co
PRIVATE EQUITY DEALS
[ts_bullet_primary] American Securities has agreed to acquire Chromaflo, an Ashtabula, Ohio-based maker of colorants and chemical dispersions, from Arsenal Capital Partners and Nordic Capital. No financial terms were disclosed for the deal, which is expected to close next month.
[ts_bullet_primary] Ashland Capital Partners has acquired Dedoes Industries, a Walled Lake, Michl.-based provider of equipment for the automotive refinish market, from Graycliff Partners. No financial terms were disclosed. www.dedoes.com
[ts_bullet_primary] Equistone Partners Europe has acquired a majority stake in United Initiators, a German producer of specialty chemical initiators, from Vision Capital and Speyside Equity. No financial terms were disclosed. www.united-initiators.com
[ts_bullet_primary] First Reserve has agreed to acquire Gas Natural Inc. (NYSE MKT: EGAS), a Cleveland-based operator of local natural gas utilities serving around 68,000 customers in Maine, Montana, North Carolina and Ohio. The deal is valued at approximately $196 million, or $13.10 per share. www.ewst.com
[ts_bullet_primary] Intelligent Medical Objects, a Northbrook, Ill.-based provider of medical terminology solutions for electronic health record systems, has raised an undisclosed amount of growth equity funding from Warburg Pincus. www.e-imo.com
[ts_bullet_primary] Precision Global, a New York-based portfolio company of Peak Rock Capital, has acquired Ralpet Plastics, an Australian manufacturer of injection and blow molded plastics products. No financial terms were disclosed. www.precisionglobal.com
[ts_bullet_primary] KKR and TowerBrook Capital Partners have agreed to invest a total of EUR250 million for a minority equity stake in OVH, a France-based provider of cloud infrastructure, telecom and web hosting services. www.ovhcom
[ts_bullet_primary] iRhythm Technologies Inc., a San Francisco-based developer of cardiac diagnostic monitoring solutions, has set its IPO terms to 5.35 million shares being offered at between $13 and $15 per share. It would have a fully-diluted value of around $310 million, were it to price in the middle of its range. The company plans to trade on the Nasdaq under ticker symbol IRTC, with J.P. Morgan and Morgan Stanley serving as lead underwriters. iRhythm reports a $10.6 million net loss on $28.6 million in revenue for the first half of 2016, and has raised nearly $100 million in VC funding from firms like Synergy Life Science Partners (16.39% pre-IPO stake), Norwest Venture Partners (16.01%), Novo AS (13.68%), New Leaf Venture Partners (12.03%), Mohr Davidow Ventures (9.76%) and Kaiser Permanente Ventures (9.37%) and Stanford University. www.irhythmtech.com
[ts_bullet_primary] No exit news this morning.
[ts_bullet_primary] Duke Energy Corp. (NYSE: DUK) has agreed to sell its Brazilian assets to China Three Gorges for $12 billion. The Charlotte-based energy company also said that it is in talks to sell its remaining Central and South American assets. Read more.
[ts_bullet_primary] Noble Group, a Singapore-listed commodities trader, has agreed to sell its North American energy distribution unit to Calpine (NYSE: CPN) for $1.05 billion. Read more.
[ts_bullet_primary] UBS pulled out as financial advisor to a $4.4 billion deal that privatized a commercial property unit of China's Dalian Wanda over credit risks, according to the FT. UBS had initiated the deal, and was replaced by China International Capital Corp. Read more.
[ts_bullet_primary] William Hill PLC (LSE: WMH), a British bookmaker, said that it is in merger talks with Amaya Inc. (TSX: AYA), the Canadian owner of PokerStars whose market cap is around C$3.4 billion. Read more.
FIRMS & FUNDS
[ts_bullet_primary] BioVentures Investors, a Wellesley, Mass.-based VC firm focused on med-tech startups, has closed its fourth fund with $87 million in capital commitments. www.bioventuresinvestors.com
[ts_bullet_primary] EQT Partners has closed its first dedicated U.S. mid-market growth buyout fund with $726 million in capital commitments. www.eqt.se
[ts_bullet_primary] Okapi Venture Capital, a Laguna Beach, Calif.-based venture firm, is raising up to $60 million for its third fund, according to a regulatory filing. www.okapivc.com
[ts_bullet_primary] Upfront Ventures is raising up to $40 million for an "ancillary" vehicle to its fourth fund, which closed on around $200 million in 2013, per a regulatory filing. The Los Angeles-area VC firm subsequently raised a $280 million fifth fund.
MOVING IN, UP AND ON
[ts_bullet_primary] Rishi Garg has joined venture firm Mayfield as a general partner. He previously was VP of strategy and corporate development at Twitter. Read more.
[ts_bullet_primary] Robert Whipple has joined mid-market private equity firm Cortec Group as a managing director. He previously was a principal with Apax Partners. Cortec also has hired Nick Cooper (ex-Piper Jaffray) as an associate and promoted Jack Milner to vice president. www.cortecgroup.com
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