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Private Equity
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May 23, 2013
Deals Rumor Mill: Yankee Candle, THL Partners, Volvo
Madison Dearborn is scrapping plans to unload Yankee Candle Co. after prospective private equity buyers refused to make multibillion-dollar offers for the company, while Volvo is considering a spinoff of its North American heavy truck unit that could yield as much as $1.5 billion.
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May 22, 2013
Midway Though Proxy Season, Staggered Boards Falling Hard
Halfway through the 2013 proxy season, the staggered board — either a shield for self-serving directors or a pillar of good stewardship, depending on whom you ask — is continuing its swift march toward extinction.
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May 22, 2013
PE-Owned Ohio Printers Seek Ch. 11 As Buyer Looms
Two Ohio-based sister commercial printing companies, both owned by private equity firm Wellspring Capital Management LLC, filed for Chapter 11 bankruptcy protection Wednesday with a prepacked plan in hand and rival company Bang Printing of Ohio at the ready with a $19 million stalking horse bid.
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May 22, 2013
Financial Services Co. Funneled Millions To Execs' Kin: Suit
A venture capital firm filed a securities fraud lawsuit Monday in New York federal court against The Cash Store Financial Services Inc. claiming that CSFS overstated its assets by $44 million and belatedly disclosed that it improperly funneled millions of dollars to its executives' relatives.
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May 22, 2013
KIT Digital's $25M Ch. 11 Deal Delayed By Equity Group
A New York bankruptcy judge on Wednesday said he was inclined to approve three private equity firms’ commitment to put $25 million toward KIT Digital Inc.’s reorganization, but held off on the ruling because of a last-minute announcement that an equity committee is being formed.
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May 22, 2013
Deals Rumor Mill: Carlyle, Saks, Sony
Carlyle is hoping to raise $2 billion more for Japan-focused investments that will cement its place as a private equity leader in the country, while Sony has opened itself to negotiations with an activist hedge fund that insists the sputtering company should consider an IPO.
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May 22, 2013
Archer Inks $244M Deal To Sell Unit To Clearlake
Oslo, Norway-based oil services company Archer LT announced Wednesday that it is selling one of its North American divisions to an affiliate of Los Angeles private equity firm Clearlake Capital Group LP for $244 million, an all-cash deal set to help payoff some of the company's debt.
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May 21, 2013
Feds Oppose Settlement Behind $320M LifeCare Sale
The U.S. government asked a Delaware bankruptcy judge Tuesday to reject a deal underpinning the $320 million sale of private equity-owned LifeCare Holdings Inc., saying the proposed settlement is impermissible because it would pay the hospital group's unsecured creditors ahead of federal tax claims.
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May 21, 2013
NetSpend Investors Can’t Block $1.4B Sale Over PE Favoritism
A Delaware Chancery judge on Tuesday denied a bid by NetSpend Corp. shareholders to block the prepaid debit card provider’s planned $1.4 billion sale for allegedly favoring two private equity shareholders, ruling the investors hadn’t shown they could scuttle the deal at trial.
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May 21, 2013
NFP Directors Sued Over $1.3B Madison Dearborn Deal
The directors and executives of brokerage services firm National Financial Partners Corp. were hit with a proposed shareholder class action Tuesday over its April deal to be acquired by private equity investment firm Madison Dearborn Partners LLC for $1.3 billion.
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May 21, 2013
Dechert Advises Morgan Creek In Signet Funds Deal
Investment advisory firm Morgan Creek Capital Management has inked a deal to scoop up the alternative funds business of Signet Capital Management Ltd., nabbing two new European footholds in the process, the company announced Tuesday.
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May 21, 2013
Novo To Lay Down $700M For Antibiotics Specialist Xellia
Novo A/S, the holding company for Danish drugmaker Novo Nordisk A/S, has agreed to purchase majority venture capital-owned Norwegian antibiotic drug specialist Xellia Pharmaceuticals A/S for $700 million, the companies announced Tuesday.
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May 21, 2013
Herbalife Preys On Latinos, Nonprofit Tells FTC
A nonprofit on Monday urged the Federal Trade Commission to investigate Herbalife Ltd., claiming its vitamin distribution network — famously called the world’s “best-managed pyramid scheme” by activist investor Bill Ackman — preys on Latinos.
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May 21, 2013
McCarter Nabs Sullivan & Worcester PE Fund Pro In NY
Veteran private equity and venture capital attorney Joseph W. Bartlett, counsel for Greylock Partners and Bain Capital LLC in their early years, has joined McCarter & English LLP as a special counsel in New York, McCarter said Monday.
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May 21, 2013
Deals Rumor Mill: Dish, Alere, Raytheon
Dish Network's chairman served up a $2 billion offer for wireless spectrum controlled by bankrupt LightSquared, while an activist investor is ratcheting up pressure on multibillion-dollar life sciences firm Alere to seek out a buyer.
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May 21, 2013
KKR To Sell $255M Stake In Australia's Seven West Media
Private equity titan KKR & Co. LP has begun to sell off its entire AU$260 million (US$254.9 million) stake in Australia's Seven West Media Ltd., operator of the biggest free-to-air television network Down Under, Seven West announced in an exchange filing Tuesday.
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May 21, 2013
BlackRock Buys PE Adviser To Double Real Estate Holdings
Global investment manager BlackRock Inc. will add $12 billion in new global real estate assets to its management portfolio, concentrated in Asia and Europe, with a new deal to buy private equity advisory firm MGPA Ltd., according to a Tuesday statement.
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May 21, 2013
GOP Sens. Hammer Lew On IRS Targeting Scandal
Secretary of the Treasury Jack Lew on Tuesday said he will push regulators to speed up finishing capital, proprietary trading and other Dodd-Frank Act-mandated rules even as questions over the Internal Revenue Service's targeting of conservative groups dominated his appearance before a Senate panel.
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May 21, 2013
Venable Shouldn't Shake $11M Facebook IPO Suit, ESG Says
ESG Capital Partners argued on Monday that a legal malpractice suit against Venable LLP should stick, alleging that the law firm helped a known con man defraud the investment manager of $11.2 million by falsely promising to secure ESG pre-IPO Facebook shares.
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May 20, 2013
PE Firm Can’t Duck Fraud Claims Over $175M Data Co. Sale
A Delaware Chancery judge ruled Friday that fraud allegations against private equity firm Thompson Street Capital Partners and others can proceed in a suit claiming they exaggerated the value of Iron Data Solutions LLC when selling the company for $175 million.
Expert Analysis
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Rise Of The Machines — Predictive Coding Goes Mainstream
The pros of using predictive coding far outweigh the cons. Given the heavy pressure on law firms and in-house counsel to reduce discovery costs, as well as the Justice Department's recent stance on the subject, it appears predictive coding will continue to emerge from the obscure world of legal technology to the mainstream of legal practice, say Michael Moscato and Myles Bartley of Curtis Mallet-Prevost Colt & Mosle LLP.
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PE Investors Should Consider Behavioral Health
As demand for behavioral health services increases, and those individuals with need have insurance that will pay for it, the growth potential for behavioral health services is significant. Private equity investors are well-poised for jumping into this market to bring new business models and innovation to the industry, say attorneys with McGuireWoods LLP.
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Tracking Emerging Growth Cos. Under The JOBS Act
Title I of the JOBS Act significantly reformed the IPO process for emerging growth companies. Although it remains to be seen how and when the U.S. Securities and Exchange Commission will implement other provisions of the JOBS Act, we believe that the IPO on-ramp reforms will continue to take on greater importance as they enter their second year, say attorneys with Latham & Watkins LLP.
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The Who, What And Why Of Public-Private Partnerships
Public-private partnerships have been used in a wide range of sectors to provide public services, from power plants and railroads to hospitals and sanitation plants. Yet there are a variety of potential contractual arrangements and the financing of a PPP can be complex, say Maryam Khosharay and Herbert Glaser of Haynes and Boone LLP.
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5 Reasons For Optimism In The Venture Capital Community
Not every company can be the next Facebook. But thankfully, for many startups, generating one billion users is not the end goal, nor should it be. Enter “narrowcasting” — one of a few reasons to be optimistic about venture capital, despite the first quarter of 2013 being the slowest for fundraising since 2002, says David Kaufman of Thompson Coburn LLP.
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Spotlight On Affiliated Lender Provisions And Debt Buybacks
Over the last few years, provisions in credit agreements permitting the borrower’s equity sponsor and other affiliates to purchase term loans made thereunder and allowing the borrower to “repurchase” such term loans on a non-pro rata basis have become common. But many of the provisions governing such purchases do not adequately protect the non-affiliated lenders’ interests in a bankruptcy of the borrower, say Robert Finley and Ram Burshtine of King & Spalding LLP.
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A Model For Facing Meritless Derivative Suits In Pa.
The decision by the Allegheny County Court of Common Pleas in In re H.J. Heinz Co. Derivative and Class Action Litigation represents a faithful application of the American Law Institute’s Principles of Corporate Governance, which were formally adopted by the Pennsylvania Supreme Court in the landmark decision Cuker v. Mikalauskas, say attorneys with Dechert LLP.
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How Crowdfunding Could Impact Film Financing
The “Veronica Mars” Kickstarter campaign has created a paradigm shift in film financing with successful crowdfunding. While crowdfunding is still a largely untouched topic by the courts, it needs to be red-flagged as an area that is ripe for litigation, says John Stephens of Sedgwick LLP.
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A Significant Impact On Private Investment Funds
U.S. Rep. Keith Ellison, D-Minn., recently reintroduced the Inclusive Prosperity Act of 2013, a financial transaction tax that, according to its supporters, would provide the federal government between $150 billion and $340 billion of revenue per year. The bill is, essentially, a sales tax on large Wall Street banks — however, its provisions seem to impact hedge funds and private equity funds, says David Sussman of Duane Morris LLP.
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SEC Tees Up Private Equity Enforcement Issues
Recent remarks by Bruce Karpati, chief of the Asset Management Unit of the U.S. Securities and Exchange Commission, as well as recent enforcement cases by the SEC, demonstrate an increased focus on the private equity sector — in particular, on aggressive fundraising disclosures, conflicts of interest and “zombie funds,” among other things, say Scott Naidech and Garrett Lynam of Chadbourne & Parke LLP.