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 peHUB Wire -- Thursday, July 16

Random Ramblings

When Steve Rattner stepped down as auto czar earlier this week, Tim Geithner said the following: “Steven Rattner, whose leadership and vision were invaluable to the Auto Task Force's efforts, has decided to transition back to private life and his family in New York City.”

Almost sounds as if he’d been just renting in DC, and that the Big Apple itch became unbearable. Except…

We’ve learned that Rattner bought a $4.35 million manse in Washington D.C. less than two months ago (you can view photos here). Now why would you spend that much money – including more than $1 million up-front – if you weren’t planning a long-term stay? Sure it’s nice to have a summer home, but isn't that why he’s building one on Martha’s Vineyard?

The answer, if course, is that Geithner was being disingenuous in his statement (although literally correct). Rattner’s resignation was sparked by increased heat from Andrew Cuomo, not from cravings for a slice of Ray’s Famous…

*** KKR has postponed fundraising for its next North American buyout fund until the start of 2010. It had originally planned to begin marketing earlier this year. The firm has a bit over $5 billion left in its current North American fund, and also recently closed a European buyout fund.

*** Two quick notes on the issue of PE firms being required to register as investment advisors with the SEC:

1. There is something ironic about legislators being worried about PE firms being a risk factor for systemic failure, at the same time that the FDIC is trying to require cross-guarantees for PE firms that invest in banks. After all, it is private equity’s explicit avoidance of cross guarantees that helps preclude the asset class from causing systemic failure.

2. Notice something missing in yesterday’s press release on this subject from the Private Equity Council? At the very bottom, THL Partners is no longer listed as a member firm. Not yet sure when or why the original member dropped, although I do recall Scott Sperling not being terribly interested in answering a PEC-related question during the Reuters PE Summit earlier this year. At the time, a colleague and I just found it a bit odd. Now we find it predictive.

*** Foundry Group has revamped its website, and now has the best VC homepage going. My only question is if Brad Feld is Mr. Pink...

*** Yesterday I posted a Q&A with Geoff Hill, the Cinnebon president and former Carvel exec who is joining Roark Capital. He answered my first four questions about franchising, and then got hit with the market-moving query: Does he prefer Fudgie the Whale or Cookie Puss? He answered that one faster than any of the others.

NEW @peHUB

* First Read, including if CIT will become Obama's Lehman Brothers, the NVCA's testimony during yesterday's Senate hearing on PE fund registration, the 25 top econoblogs and Krugman on Colbert. 

* Second Opinion, including a PE firm's dismay that sexual harassment charges against it have become public, Wells Fargo sues itself, and ex-Bear Stearns exec is raking at the WSOP and Jon Stewart keeps hammering Jim Cramer.

* If CIT goes down, these PE-backed companies may be hurting

* 8 Questions and 7 Answers with Richard Zannino, the ex-Dow Jones CEO who yesterday joined CCMP Capital.

* 5 Questions for Geoff Hill, the Cinnabon president who is joining Roark Capital.

* PE Council supports registration of PE firms, in testimony yesterday in front of a Senate Subcomittee.

* Venture capital firm DFJ is in advanced talks to open an affiliate in Japan.

* Advent International is raising its fifth Latin America fund.

* Comic Dave Chappelle held a surprise show in Portland, but 4,000 Twitterers crashed the scene.

 

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   Top Three

CIT Group Inc. said that bailout talks with the U.S. government have ended, which could mean that a bankruptcy filing is just around the corner. Read more…

GTCR has formed Palladian Financial Holdings, a Wilmington, Del.-based acquisition platform focused on the credit, payments and loyalty/rewards market. The firm has committed up to $300 million in equity. Palladian will be run by Michael Rhodes, former vice chairman at MBNA. Read more...

Water Street Healthcare Partners
has acquired the Pharmaceutical Development unit of AAIPharma Inc. The company will be called AAIPharma Services Corp., and will retain its Wilmington, N.C. headquarters. The deal is valued at $75 million, including expansion capital commitments. No purchase price was disclosed.
Read more..

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   VC Deals

ConnectEdu, a Boston-based provider of a college and career planning network, has raised $8.2 million in Series C funding led by Allen & Company. Read more...

Invodo Inc., an Austin, Texas-based online video management platform, has raised $6 million in Series B funding from return backers Sevin Rosen Funds and S3 Ventures. The company previously raised $1.5 million. Read more…

ProtonMedia, a Lansdale, Penn.-based provider of a social collaboration platform, has raised $2.5 million in Series A funding. Backers include Originate Ventures and Osage Ventures. Read more…

GreenRay Inc., a Westford, Mass.-based developer of DIY solar technology for residential homes, has raised $2 million in Series A funding. Quercus Trust led the round, and was joined by 21Ventures. Read more…

Aloqa Inc., a Palo Alto, Calif.-based developer of context-aware mobile applications, has raised $1.5 million in Series A funding. Wellington Partners led the round, and was joined by individual angels. Read more...

Cognition Therapeutics Inc., a Pittsburgh-based developer of treatments for Alzheimer's, has raised $1.21 million in Series A funding. Ogden CAP led the round, and was joined by M5Invest Partners, Pittsburgh Life Sciences Greenhouse, Innovation Works and individual angels. Read more…

IntegriChain Inc., a New York-based provider of data and analytics to the pharma industry, has raised an undisclosed amount of Series B funding. Milestone Venture Partners led the round, and was joined by Cross Atlantic Partners. Read more…

Home-Account Inc., a San Francisco-based provider of an online mortgage finding service, has raised an undisclosed amount of new funding from Rembrandt Ventures and Freedom Financial Network. It previously had been seeded by Charles River Ventures' QuickStart program. Read more…

*** Venture Capital news updated all day at peHUB's VC Channel ***

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  Buyouts Deals

 

Cinven and Candover have received revised bids for Springer Science and Business Media, after second-round offers came in lower than expected. The sellers are seeking €500 million for a 49% stake in Springer, a German academic publisher. Bidders include TPG Capital, EQT Partners and a pairing of The Carlyle Group with Providence Equity Partners. Read more…

Cox Communications is auctioning off The Travel Channel, with Goldman Sachs managing the process. The sale is expected to generate between $600 million and $1 billion. Read more…

KKR
reportedly is leading a consortium that is in talks to acquire around a 30% stake in International Far Eastern Leasing Co., a Chinese lender to small and mid-sized businesses. The equity check could be for between $150 million and $200 million, with GIC and CICC also participating. Read more…

MatlinPatterson is working with an undisclosed strategic partner on a reorganization plan for bankrupt telecom equipment maker Nortel Networks. MatlinPatterson is a major Nortel bondholder and creditor, and opposes a proposed sale of Nortel’s wireless unit to Nokia Siemens Networks. Read more…

*** Buyouts news updated all day at peHUB's Buyouts Channel ***

  Firms & Funds

Barclays PLC is considering a sale of its private equity unit, including a possible management buyout in which Barclays would retain a minority stake. Read more…

Apollo Commercial Real Estate Inc.
, an affiliate of Apollo Management, has filed for a $600 million IPO. The REIT would invest in commercial mortgage-backed securities. Read more…

  Human Resources

Monty York has joined GenNx360 Capital Partners as a managing partner. He previously was managing partner of SV Investment Partners, and before that was a principal with Aurora Capital Group. Read more…

Quinton Jay has been named a managing director of Bacchus Capital Management, a private equity and mezzanine firm focused on the wine industry. He previously was vice president and general manager of Artesa Winery and Vineyards. Read more…

Jason Lettman has joined Morgenthaler Ventures as a vice president, focused on medical device investments. He will be based in the firm's Menlo Park office, and previously was a vice president with Split Rock Partners. Read more…

Jason Wang has been named chief financial officer of AutoChina International Ltd., a commercial vehicle lease financing company in China. He previously was director ofresearch and analytics for Private Equity Management Group Inc. Read more…

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