BLP’s of Week August 12th in Review

Earnings, IPO’s, M&A and Private Placements

Earnings Reports

http://www.dreamstime.com/royalty-free-stock-image-stock-market-chart-image16956276Retail disappointed this week, but wait, there’s a silver lining.  People are spending their money on cars and houses.  Wal-Mart (WMT:  NYSE), Kohls (KSS:  NYSE) and Macy’s (M:  NYSE) all reported weak results. Retail sales rose 3.8%, while auto sales rose 9.5%.  Small ticket items didn’t fare well:  American Eagle Outfitters, Aeropostale, and Nordstrom all lowered their profit and sales outlook.  Even cosmetics, with Estee Lauder.

On the tech side,  Applied Materials (AMAT:  Nasdaq) disappointed by a penny, which helped Thursday’s market sell-off gather steam.  Other tech market bellwethers,  Network Appliance (NTAP:  Nasdaq) and Brocade (BRCD:  Nasdaq), announced in-line earnings:

IPO’s of the Week[1]

The outlook towards higher interest rates, and the uncertainty of a new Fed Chairman, brought on market tremors.  IPO’s were put on hold.  Unsurprisingly, the deals that did get done were healthcare related.

Sophiris Bio (SPHS:  Nasdaq) managed to sneak out on Friday at $5.00 per share, $4.15.  Sophiris is a Canadian company, based in San Diego, that is developing highly targeted treatments for late-stage enlarged prostates.

Envision Healthcare, (EVHC: Nasdaq) which is a roll-up, got out early in the week, before the 225 point market drop.  It priced at $23, the high end of the range, raising $966m.  Envision Healthcare is a healthcare conglomerate, and combines an ambulance service company, a physicians services company,  and a chronic disease management company.

M&A of Interest

Arinc, a Carlyle Group transportation communications specialist was purchased by Rockwell Collins for $1.4b.  Another one leaves the nest.

Samsung acquired German lighting specialist Novaled, which  manufactures OLEDs, for $347m.

And there were two small solar deals

  • Real Goods Solar (RSOL:  Nasdaq), of Louisville, CO acquired two residential solar solutions providers:  Syndicated Solar out of Denver and Mercury Solar located in Port Chester, NY.
  • SolarCity (SCTY:  Nasdaq) acquired Paramount Solar for $120.  Paramount Solar is a direct to consumer  marketing company that directs consumers to installers such as SolarCity.·

NBCNews acquired Stringwire

Jibbigo, a speech-to-speech translation company for Android and Apple mobile devices, was acquired by Facebook (FB:  Nasdaq)

Intuit (INTU:  Nasdaq) acquires GoodApril, a free on-line tax planning service for consumers.

Millennial Media (MM:  NYSE) acquired Jumptap, a social event marketing specialist.

Trusteer, a fraud prevention company, was acquired by IBM (IBM:  NYSE) for $80m

Marakana,  which offers instructor led, open source technology training courses, was acquired by Twitter

Agero, a roadside assistance program with connected vehicle solutions was acquired by Sirius XM Radio for $530m

Enguage, a marketing agency, was acquired by Publicis Group (PUBGY:  OTC) for $60m

Finally, Steinway Musical Instruments was acquired by Paulson & Co for $512m.  I guess John needs more challenges!  An interesting investment by an alternative assets fund manager.

Private Placements of Interest

Restorando, the Open Tables of South America, raised a $13m Series B round

Fitbit, raised $43m in private equity.  Which they will need to compete against Nike and Jawbone.  It’s  a feisty three-way race, with additional market entries every day

Glam Media raised a $25m round.  While their company description doesn’t tell you what they do, Glam Media claims to be a vertical media company with more than 1,500 lifestyle websites and blogs that provide engagement with consumer brands.  They also claim to be incredibly successful.

AvantCredit raised $20m.  AvantCredit, which operates in fifteen states, is an analytics-based personal loan lender of between $1,000 to $10,000, based in Chicago.

Sosh  raised $10m to develop communities, and is currently serving people in New York City and San Francisco.  One must ‘join’ Sosh, using one’s Facebook credentials.  The site then introduces you to events, activities and places it believes are of interest to you.

Looker raised $16m, and aims to be the Lotus 1-2-3 of big data analytics, bringing those capabilities to the desktop.

CloudPhysics raised a $10m round to develop and market an app store for VMware users.

InsideView raised a $19m Series D round.  The Company gathers real-time data from social sources and delivers it in real-time for use by sales reps.

MyFitnessPal  raised an $18m Series A round.  The Company operates a free on-line calorie counter and diet plan

SilkRoad Technology raised $16m.  The Company provides social talent management tools.

Also of Interest

I was going to write something about Egypt, but it’s just too sad and too raw right now.  We live in a connected universe, and all know people in the country.  A former colleague from Needham currently lives in Egypt.  One hopes that they are far enough from the fray to be safe and relatively unscathed.

Margaret S.C. Johns

Founder, BlueLake

About the author:

Margaret Johns has been a voyeur of the technology world for as long as she can remember, starting at her father’s knee when he took her to CalTech’s Palomar Observatory, and had home showings of NASA films of the Project Mercury’s space rocket launches.

She migrated from research and development at Sandia Labs to technology investment banking, where she was an employee founder at Needham  & Company.   Being a tad too independent for New York City’s investment banking world, she subsequently founded her own firm, BlueLake, where she continues to pursue and work with interesting technology companies.

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This newsletter does not purport, in any sense, to be comprehensive.  Rather, it contains news that we, at BLP, find of interest.

 



[1] Certain information sourced from Renaissance Capital