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From:

"Dan Primack"

Name:

Dan Primack

Email Address:

Dan_Primack@fortune.chtah.net

Subject:

Term Sheet -- Wednesday, January 2

Date:

02-01-2013 16:19:42
Message

Term Sheet Private Equity Venture Capital Banking Tech Hedge

Term Sheet by Dan Primack


Wednesday -- January 2, 2013
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Random Ramblings
Todays big deal is that Avis Budget Group has agreed to buy listed car-sharing company Zipcar for
approximately $500 million in cash, or $12.25 per share (49% premium over Mondays closing price). A
couple quick thoughts:
* One of the big expected synergies here is fleet optimization. Avis usually sees peak usage at mid-week,
and often has idle supply on the non-holiday weekends. Zipcar, on the other hand, is busiest on the
weekend and relatively slow during the week. The combination is expected to help even out those peaks
and valleys a bit.
* Expect the deal to seriously expand zipcar into airports, including one-way usage to and from airports.
* Zipcar will continue to be operated by its existing management team out of Boston.
* There appears to be no go-shop agreement, nor is there any indication in the regulatory filings that ZipCar
will be listening to rival bids.
* When ZipCar priced its IPO in April 2011 at $18 per share, and finished the day up around 70% at an
enterprise value of approximately $1.1 billion.
* Prior to going public, Zipcar had raised over $38 million in VC funding, from Revolution Living, Benchmark
Capital, Greylock Partners, Smedvig Capital and Globespan Capital Partners. Ive still got to look up the
total returns, but worth noting that Revolution, Benchmark and Greylock continue to have board
representation.

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*** Exit signs: 49 venture capital-backed companies raised $21.5 billion by going public on U.S.
exchanges in 2012, according to data released this morning by Thomson Reuters and the National Venture
Capital Association. That represents the largest dollar amount since 2000, thanks almost entirely to the $16
billion Facebook offering. If you remove Facebook, the dollar total falls below both 2010 and 2011 totals.
For context, 68 VC-backed companies raised $7.6 billion via IPOs in 2010, and 51 VC-backed companies
raised $10.7 billion in 2011.
In terms of M&A exits, the 2012 figures came out to 435 sales for around $21.46 billion in disclosed value.
(note: disclosed value is very different from actual value). This compares to 488 M&A exits in 2011 with $24
billion in disclosed value.
*** Fiscal cliff deal: No big surprises in last nights deal, vis--vis the VC and PE markets. Carried interest
not addressed, capital gains and dividend tax rates rise to 20% for those making more than $400k per year
(or $450k as a family) and the payroll tax cut was not extended (probably the most salient short-term econ
impact of deal). Oh, and sequestration totally punted.

Stuff to read @Fortune.com


Pre-Marketing: Behind the scenes of cliff deal, SImpson-Bowles reax, what we all learned in
2012, British buyout boom and social graph multiplicity.
Kurt Wagner: 10 IPOs to look for in 2013
Nin-Hai Tseng: 3 bright spots in the U.S. job market for 2013
Michael Gaiss: 7 new VC initiatives worth watching
Dan Primack: KKR's rifle retailer
Stephen Gandel: High-yield market may be running out of steam
Mohamed El-Erian: Economy isn't the real beneficiary of fiscal cliff deal

The Big Deal


Avis Budget Group Inc. (Nasdaq: CAR) has agreed to acquire Boston-based car-sharing company Zipcar
Inc. (Nasdaq: ZIP) for approximately $500 million in cash, or $12.25 per share (49% premium to Mondays
closing price). www.zipcar.com

VC Deals
Kyruus, a Boston-based big data startup for hospitals and health systems, has raised $11 million in Series
B funding. Lux Capital led the round, and was joined by Fidelity Biosciences and return backers Venrock
and Highland Capital Partners. www.kyruus.com

Private Equity Deals


Advanstar Global LLC has completed its previously-announced acquisition of fashion event organizer
ENK International LLC from Forstmann Little & Co. No financial terms were disclosed. Advanstar
shareholders include Veronis Suhler Stevenson, New York Life Capital Partners and Citigroup Private
Equity. www.advanstar.com
CoBe Capital has acquired Warendorfer Kchen GmBh, a German maker of living room-style kitchens,
from AFG Arbonia-Forster Group (SWX: AFGN). No financial terms were disclosed. www.warendorf.eu

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The Gores Group has acquired Therakos Inc., a Raritan, N.J.-based provider of technologies for a
leukapheresis-based immunomodulatory therapy called extracorporeal photopheresis, from Ortho-Clinical
Diagnostics. No financial terms were disclosed. Ortho-Clinical Diagnostics is a subsidiary of Johnson &
Johnson (NYSE: JNJ). www.gores.com
Great Point Partners has completed a dividend recap for portfolio company Health Systems
International, an Indianapolisbased provider of outsourced medical cost management solutions for selfinsured corporations and insurance companies. No financial terms were disclosed. www.us-hsi.com
GTCR has acquired Correctional Healthcare Cos., a Greenwood Village, Colo.based provider of inmate
healthcare services to jails and prisons. Sellers include Enhanced Equity Fund and Gemini Investors.
No financial terms were disclosed. www.gtcr.com
Unitas Capital has agreed to acquire a control stake in Shenzhen ZTE Netview Technology Co., a
Chinese maker of telecom and video surveillance equipment, from Chinas ZTE Corp. for approximately
$200 million. www.unitascapital.com
US Joiner, a Crozet, Va.-based provider of marine joiner and furniture solutions for U.S. government and
commercial customers, has acquired JCI Metal Products Inc., a San Diegobased provider of
maintenance, repair and overhaul services focusing on habitability, fabrication, electrical and piping
solutions to U.S. Navy vessels. No financial terms were disclosed.US Joiner is a portfolio company of J.F.
Lehman & Co. www.jflpartners.com
Warburg Pincus has acquired JHP Pharmaceuticals LLC, a Parsippany, N.J.based maker of sterile
injectable products, from Morgan Stanley Principal Investments. The deal was valued at $195 million.
www.jhppharma.com

PE-backed IPOs
No PE-backed IPO news this morning.

Exits
Imation Corp. (NYSE: IMN) has acquired Nexsan Corp., a Thousand Oaks, Calif.-based maker of diskbased storage systems, for $105 million in cash and approximately $15 million in stock. Nexsan had raised
over $17 million in VC funding since 2003, from firms like VantagePoint Venture Partners, GESFID, RRE
Ventures and Beechtree Capital. It also had filed for an IPO in 2008, before later withdrawing registration
due to unfavorable market conditions. www.nexsan.com

Other Deals
ArcelorMittal has agreed to sell a 15% stake in ArcelorMittal Mines Canada for $1.1 billion to an investor
group that includes South Korea-listed POSCO and Taiwan-listed China Steel. www.arcelormittal.com
Iberdrola has agreed to sell 32 operating wind farms in France to a consortium that includes GE Energy
Financial Services, MEAG and EDF Energies. The deal is valued at 350 million, plus another 50 million
in potential earnouts.
New Source Energy Partners LP, an Oklahoma City-based limited partnership that will hold all of New
Source Energys oil and gas assets, has filed for a $106 million IPO. It plans to trade on the NYSE under

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ticker symbol NSLP, with Baird and Stifel Nicolaus serving as co-lead underwriters. www.newsource.com
Qatar Telecom has increased its stake in Tunisian telecom operator Tunisiana from 75% to 90%, in a
deal valued at $360 million. The Tunisian government will retain the remaining 10% position. www.qtel.qa

Firms & Funds


No firm or fund news this morning...

Moving In, Up and On


Arthur Akopyan has joined UFG Private Equity as a partner. He previously worked with Russian asset
management firm SSCP. www.pe.ufgam.com
Mike Mikan has agreed to join hedge fund manager ESL Investments as president. He served as interim
CEO of Best Buy between April and September 2012, and is stepping down from the Best buy board,
effective immediately. www.bestbuy.com

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