| | | | | | | Presented By EY | | | | Pro Rata | | By Dan Primack ·Nov 23, 2020 | | 📺 "Axios on HBO" tonight (11pm ET/PT) includes my new interview with Moderna chief medical officer Tal Zaks (preview clip). - Plus: Mike Allen sits down with Charles Koch for his first TV interview in four years (clip), Southwest Airlines on flying in a pandemic and the Boeing 737 MAX (clip), and Rep. Tony Cárdenas (D-Calif.) on where the Democratic Party fell short with Latino voters.
| | | | | | Top of the Morning |  | | | Illustration: Sarah Grillo/Axios | | | | COVID-19 is the macro horror of our lifetimes, and has destroyed or severely damaged countless businesses. But, like with most horribles, it also has created some opportunities. Driving the news: Merck this morning announced an agreement to buy OncoImmune, a Maryland-based biotech that showed promising late-stage clinical results for a therapy that treats severe and critical coronavirus cases. Deal details: Merck will pay $425 million in cash upfront plus possible earnouts for OncoImmune, which will spin out its non-coronavirus assets into an independent company. Merck also will invest $50 million into that new business, focused on cancer and autoimmune diseases, while OncoImmune's existing VC backers and company management will own the rest. - Drug details: OncoImmune in September released interim results from 75% of the Phase III clinical trial's planned enrollment, showing that those who received its therapeutics improved at a rate 60% higher than those who received the placebo, with the risk of death or respiratory failure cut in half.
This deal comes just days after AbCellera, Eli Lilly's partner on a monoclonal antibody treatment for COVID-19, filed for a $200 million IPO. - AbCellera, which raised over $100 million in VC funding from firms like DCVC, Viking Global and Founders Fund, also added Peter Thiel to its board and paid $90 million to buy a startup developer of genetically engineered mice that can generate fully human monoclonal antibodies.
It also comes on the same day that Bob Nelsen of Arch Venture Partners disclosed the creation of Resilience, which will operate as a giant COVID-19 supply chain manufacturing onshoring company. - Word was that Resilience was seeking to raise around $1 billion in Series A funding, with the official release putting the Series A figure at "over $800 million" from such backers as Nelsen's Arch Venture Partners, 8VC, GV and NEA.
The bottom line: We've talked a lot about how the pandemic has bifurcated the economy into Wall Street and Main Street. But it also appears to have created a bespoke economy altogether. |     | | | | | | Also... | | Steve Schwarzman, CEO of the Blackstone Group and a top Trump ally, today acknowledged reality, telling Axios that Joe Biden won the presidential election: "I'm a fan of good process. In my comments three days after the election, I was trying to be a voice of reason and express why it's in the national interest to have all Americans believe the election is being resolved correctly. But the outcome is very certain today, and the country should move on." Deal scoop: PrismHR, a portfolio company of Stone Point Capital, quietly acquired ePay Systems, a Chicago-based provider of HR and payroll software for employers with distributed workforces, Axios has learned. - EPay had received a PPP loan back in the spring, but PrismHR/Stone Point required that it to pay the loan back before closing on the deal.
Deal scoop #2: Axios' Kia Kokalitcheva reports that Atlanta-based scheduling software maker Calendly is raising around $300 million in new funding, including a secondary tranche, at around a $3 billion valuation. Several brand-name firms are vying to participate. Fund scoop #1: Contour Venture Partners raised $82 million for its fourth seed-stage fund, Axios has learned. The firm, which focuses on enterprise SaaS, B2B SaaS and financial services startups, also raised its second growth fund to support later rounds for existing portfolio companies. - Why it matters: Contour was founded in 2005 as the first seed-stage fund focused on New York City, and has kept a fairly low profile despite being the first money into companies like Datadog.
Fund scoop #2: Ibex Investors, a Denver-based multistrategy investment firm, raised $100 million for its second VC fund focused on Israeli startups. | | | | | | | | The BFD | | Source: Giphy Torchy's Tacos, an Austin, Texas-based restaurant chain, raised $400 million in new funding led by majority shareholder General Atlantic. - Why it's the BFD: It appears that tacos might be pandemic-proof. Torchy's has added 20 locations this year, as other restaurant chains have struggled or outright failed, and the new investment might set it up for a 2020 IPO. Overall, it now has 83 stores in seven states, with average unit volume of $3.8 million.
- New investors include D1 Capital Partners, T. Rowe Price, Lone Pine Capital and XN.
- The bottom line: Torchy's defied the startup cliché of being founded in someone's garage. Instead, it launched inside a food truck. No word on if that food truck was kept inside a garage.
| | | | | | | | A message from EY | | Why the digital agenda has become a core PE focus | | |  | | | | For private equity, the time has come to activate a digital strategy throughout the deal lifecycle and across the portfolio. Learn how the digital agenda has become a core focus across the private equity ecosystem. Read our latest EY digital article series. | | | | | | Venture Capital Deals | | • Loadsmart, a New York-based digital freight brokerage, raised $90 million in Series C funding. BlackRock led and was joined by Chromo Invest, TFI International, Maersk, Bramalea Partners and Perry Capital. http://axios.link/x32U 🚑 Catamaran Bio, a Cambridge, Mass.-based developer of developing allogeneic CAR-NK cell therapies to treat cancer, raised $42 million in Series A funding. Sofinnova Partners and Lightstone Ventures co-led, and were joined by Takeda Ventures, Astellas Venture Management and founding backer SV Health Investors. www.catamaranbio.com • Turtlemint, an Indian insurance comparison platform, raised $30 million. GGV Capital led and was joined by American Family Ventures, MassMutual Ventures, SIG Ventures, and return backers Sequoia Capital India, Blume Ventures, Nexus Venture Partners and Trifecta Capital. http://axios.link/CYdu • Metigy, an Australian marketing decision-making automation platform for SMBs, raised A$20 million. Return backer Cygnet Capital led, and was joined by Regal Funds Management, OC Funds, Five V VC and Thorney. http://axios.link/H9L8 🚑 GT Medical Technologies, a Tempe, Ariz.-based developer of radiation therapy solutions for brain tumors, raised $16 million in Series B funding. MVM Partners led, and was joined by return backers MedTech Venture Partners and BlueStone Venture Partners. www.gtmedtech.com • Observable, a San Francisco-based data visualization platform, raised $10.5 million in Series A funding co-led by Sequoia Capital and Acrew Capital. www.observablehq.com • Kea, an automated system for restaurants to take phone orders, raised $10 million in Series A funding. Marbruck led, and was joined by Streamlined Ventures, Xfund, Heartland Ventures, DEEPCORE, Barrel Ventures and AVG Funds. http://axios.link/Qfhx • Sleek, a corporate services platform for founders in Singapore and Hong Kong, raised $4 million led by the investment arm of Enterprise Singapore. http://axios.link/O3ch • Lightfox Games, a Seattle-based mobile games developer, raised $3.3 million. March Gaming led, and was joined by Hiro Capital and 1Up Ventures. www.lightfoxgames.com | | | | | | | | Private Equity Deals | | • Ares Management and Pretium sweetened their takeover agreement for U.S. rental homes owner Front Yard Residential (NYSE: RESI) by just over 20%, for a total value of $2.5 billion (including assumed debt). www.frontyardresidential.com • BGH Capital sweetened its takeover offer for Australian theme parks operator Village Roadshow (ASX: VRL) by nearly 30%, to A$585.9 million. http://axios.link/G1Jo • CVC Capital Partners and Clayton Dubilier & Rice are vying to buy Bilfinger, a listed German industrial services provider with a market cap over €990 million, per Bloomberg. http://axios.link/iQUr • GI Partners acquired Valet Living, a Tampa, Fla.-based doorstep waste removal company for the multifamily housing industry, from Ares Management and Harvest Partners. www.valetliving.com • Inigo, a new Lloyd's of London insurer, raised $800 million from an investor group that included Qatar Investment Authority and Caisse de dépôt et placement du Québec. http://axios.link/aG38 ☕ Rhone Capital agreed to buy a minority stake in Italian coffee roaster Ilycaffe. http://axios.link/AYDB • Virtusa (Nasdaq: VRTU) shareholders approved a $2 billion, $51.35 per share, takeover by Baring Private Equity Asia. http://axios.link/RLtF 🚑 Warburg Pincus invested in Quantum Health, a Columbus, Ohio-based consumer health care navigation and care coordination company, from Great Hill Partners (which retains a minority stake). www.quantum-health.com | | | | | | | | Public Offerings | | • Only one company, Russian e-commerce giant Ozon Holdings, and two SPACs plan to go public on U.S. exchanges this week. http://axios.link/juW1 • Backblaze, a San Mateo, Calif.-based provider of cloud storage and backup software, is talking with banks about a 2021 IPO that could value the company at around $1 billion, per Reuters. http://axios.link/D1SG • Evergrande Group of China said its property management unit will seek to raise over $2 billion in a Hong Kong IPO. http://axios.link/ySgF 🚑 Nanobiotix, a French developer of nanoparticle therapies for cancer, filed for a $60 million U.S. float. It currently trades on the Euronext Paris (NANO) and plans to list on the Nasdaq (NBTX). http://axios.link/CFCM | | | | | | | | SPAC Stuff | | • AvePoint, a Jersey City, N.J.-based provider of Microsoft Sharepoint management software, agreed to go public via a reverse merger with Apex Technology Acquisition Corp. (Nasdaq: APXT), at around a $2 billion equity value. AvePoint backers include Sixth Street Partner and Goldman Sachs. www.avepoint.com • GigCapital2 (NYSE: GIX) agreed to acquire and merge UpHealth (Marquette, Wisc.) and CloudBreak Health (Columbus, Ohio), via a deal that would create a digital health care company valued at $1.35 billion, per Reuters. CloudBreak had raised around $25 million from Kayne Anderson and Columbia Partners Private Capital. http://axios.link/zdDH • Americas Technology Acquisition, a TMT-focused SPAC led by Lisa Harris (Align Capital) and Jorge Marcos (Fifth Partners), filed for a $100 million IPO. http://axios.link/e356 • Fortress Value Acquisition III, a SPAC formed by Fortress Investment Group execs, filed for a $200 million IPO. http://axios.link/g7Yc 🚑 Frazier Lifesciences Acquisition, a biotech-focused SPAC firmed by Frazier Healthcare Partners, filed for a $100 million IPO. http://axios.link/xEWy • Nebula Caravel Acquisition, the third tech-focused SPAC formed by True Wind Capital, filed for a $250 million IPO. http://axios.link/BFNu • Andrea Pignataro, the founder of financial data and trading software company ION, is in talks to launch a SPAC, per Bloomberg. http://axios.link/LvCv | | | | | | | | Liquidity Events | | • Center Lane Partners agreed to sell Los Angeles-based blender maker Capital Brands to Italian appliance maker De' Longhi for around $420 million. http://axios.link/1zHF | | | | | | | | More M&A | | • Alpha Bank of Greece picked New York-based Davidson Kempner as the preferred bidder for a €10.8 billion portfolio of bad debt. It would be Greece's largest-ever sale of non-performing loans. http://axios.link/IYJM • Credit Agricole (Paris: ACA) offered to buy Italian bank Creval (BIT: CVAL) for €737 million. http://axios.link/Xyxd 🚑 GE Healthcare agreed to buy Prismatic Sensors, a Swedish developer of photon-counting detectors. http://axios.link/snOd • Western Union (NYSE: WU) acquired a 15% stake in the digital payments unit of Saudi Arabia's STC Group for $200 million. http://axios.link/ScDM | | | | | | | | Fundraising |  | | | Photo by Justin Sullivan/Getty Images | | | | • Andreessen Horowitz raised $1.3 billion for its seventh flagship venture fund and $3.2 billion for its second growth fund. http://axios.link/vWt7 • Bain Capital raised $800 million or its second impact investing fund. http://axios.link/N2Pr • The Blackstone Group is targeting $5 billion for its second Asia-focused buyout fund, per Reuters. http://axios.link/R3kf • Growth Catalyst Partners, a mid-market private equity firm co-led by Jim TenBroek (ex-Wind Point Partners) and Scott Peters (ex-JEGI), raised $130 million for its debut fund. It will focus on the marketing, information and tech-enabled services sectors. www.growthcatalystpartners.com • KKR is premarketing a sixth Europe-focused buyout fund that is expected to target more than the €5.8 billion KKR raised just last year for its fifth such vehicle, per Bloomberg. http://axios.link/xXei • Tenex Capital Management is raising $1 billion for its third mid-market buyout fund, per public pension documents. http://axios.link/YClH • Work-Bench of New York is raising $100 million for its third VC fund, per an SEC filing. www.work-bench.com | | | | | | | | It's Personnel | | 🚑 Mike Butler, former president of health care system Providence, joined Welsh, Carson, Anderson & Stowe as an operating partner. www.wcas.com • Prosper Vignone, former head of biz dev for IBM Global Markets, joined private equity firm Siris as a principal. www.siris.com | | | | | | | | Final Numbers | Source: Refinitiv Deals Intelligence. Data through November 19, 2020. | | | | | | | | A message from EY | | Private equity should remain bullish on health care deals | | |  | | | | 2020 health care private equity deal volumes will be down 15-20% from 2019, but experts say the worst is over. Listen to EY NextWave Private Equity's latest podcast on why PE should remain optimistic about investing in the health care sector despite the short-term detriment of COVID-19. | | | | ✔️ Thanks for reading Axios Pro Rata! Please ask your friends, colleagues and taco truck drivers to sign up. | | | | Axios thanks our partners for supporting our newsletters.
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