Rearview Mirror: Week Ending March 23rd, 2014

The Market, IPOs, Mergers & Acquisitions, Private Placements

What’s Happenin’?

Week Ending March 23rd, 2014 

  • We love to hear your opinions and comments at mjohns@bluelakepartners.com
  • If you like what you read, please share via the SHARE button at the very, very end of this blog
Source:  victoriadailyphoto.blogspot.com
Source: victoriadailyphoto.blogspot.com

We spent most of the weekend at Harvard’s Blodgett Pool, at the New England Short Course Championships.  Yes, I squeezed myself into that fastskin, and was able to pick up a few ribbons.  The weather outside was that early spring “crisp,” but inside was toasty warm.

The Market/Earnings[1]

Click on the Company Name for the earnings announcement, and the Company Symbol for the stock chart.

Oracle and Adobe announced earnings this week that were anemic:  low single digit to no growth, I could only think:  This is the new technology Rust Belt:  Microsoft (mentioned last week), Salesforce.com, Oracle and Adobe.  All are major bellwether stocks, now on the other side of the growth curve.  To call them momentum stocks would be stretching the term.  Even Google and Facebook are aging, or shall we say “maturing,’ and are at the teenager stage.

Adobe Systems (ADBE:  Nasdaq) reported a first quarter profit of $47m or $0.09 per share from $65.1m or $0.13 per share.  Revenue was unchanged at $1b.  This product transition to the Creative Cloud, while necessary is painful.

Nike (NKE:  NYSE) had strong results—revenues up 13 percent to 7.0b and earnings up four percent to $0.76 per share—but not strong enough.  The stock dropped from the $79-80 per share range to $75.21 per share.

Oracle (ORCL:  Nasdaq) announced third quarter profit of $2.57b or $0.56, when the street was expecting $0.70 per share.  Revenues were $9.32b, up  from $8.96 YOY.  Investors were underwhelmed.

Under rising regulatory pressure, JP Morgan sold its physical commodities trading unit to Mercuria Energy, which is run by two former Goldman Sachs executives..

This week was all about the Yellen Fed, as Ms. Yellen held her first press conference on Wednesday, and signaled her desire to raise rates sooner rather than later, in 1Q15.  Yellen suggested a six month gap between the end of asset purchases to potential rate hikes.  That, with the slowdown in China has investors concerned.

The long-awaited Alibaba IPO is happening.  The Company’s valuation is rumored to be between $150b and $200b (in contrast to Facebook’s $104b IPO valuation).

IPOs[2]

(6 IPO’s)

Click on the Company Name for the S-1 filing and the Company Symbol for the stock chart.

A10 Networks (ATEN:  Nasdaq) sold 12.5m shares at $15 per share raising $187.5m at a valuation of $885m.  The stock closed the week at $16.21 per share.  A10 is a provider of advanced application networking technologies:

Our products are built on our Advanced Core Operating System, or ACOS, platform of advanced networking technologies, which is designed to enable our products to deliver substantially greater performance and security relative to prior generation application networking products. Our software based ACOS architecture also provides the flexibility that enables us to expand our business to offer additional products to solve a growing array of networking and security challenges arising from increased Internet cloud and mobile computing.[3]

Amber Road (AMBR:  Nasdaq) sold 7.4m shares at $13 per share, raising $96m at a valuation  of $324m.    Both the size of the deal and the valuation range were increased.  Amber Road provides global trade management solutions:

Our mission is to dramatically change the way companies conduct global trade. As a leading provider of cloud-based global trade management (GTM) solutions, we automate import and export processes to enable goods to flow across international borders in the most efficient, compliant and profitable way. Our solution combines enterprise-class software, trade content sourced from government agencies and transportation providers in 125 countries, and a global supply chain network connecting our customers with their trading partners, including suppliers, freight forwarders, customs brokers and transportation carriers.[4]

Revenues have doubled over the past two years to $52m.  The stock closed the week at $17 per share.

Borderfree (BRDR:  Nasdaq) sold 5m shares at $16 per share, raising $80m at a valuation of $488m.  Borderfree is a market leader in international cross-border ecommerce, operating a proprietary technology and services platform to enable U.S. retailers to transact with consumers in more than 100 countries and territories worldwide.[5] The stock closed the week at $20 per share.

Versartis  (VSAR:  Nasdaq) sold 6m shares at $21 per share raising $126m at a valuation of $489m.  Versartis is a “endocrine-focused biopharmaceutical company initially developing our novel long-acting recombinant human growth hormone, VRS-317, for growth hormone deficiency, or GHD, an orphan disease.[6]”  The stock closed the week at $31.37 per share.

Akebia Therapeutics (AKBA:  Nasdaq) sold 5.9m shares at $17 per share, raising $100.3m at a valuation of $311m.  Akebia is a “biopharmaceutical company focused on the development of novel proprietary therapeutics based on hypoxia inducible factor, or HIF, biology and the commercialization of these products for patients with kidney disease.[7]”.  The stock closed the week at $23.70 per share.

MediWound (MDWD:  Nasdaq), based in Israel, sold 4m shares at $14 per share, raising $70m at a valuation of $286m.  MediWound is a “fully integrated biopharmaceutical company focused on developing, manufacturing and commercializing novel products to address unmet needs in the fields of severe burns, chronic and other hard-to-heal wounds and connective tissue disorders.[8]”  The Company’s stock closed the week at $18.16 per share.

Mergers & Acquisitions[9]

(5 transactions noted)

ONO, a Spanish cable television provider is being acquired by Vodafone for $10b.

.CO acquired by Neustar, a provider of real-time information and analytics, for $109m.  .CO is the exclusive operator of the worldwide registry for internet addresses with the “.co” top-level domain.

GPS Global is being acquired by SecureAlert for $11m. GPS Global is based in Israel.  SecureAlert, based in Sandy, Utah, markets and deploys offender monitoring solutions that combine tracking technologies with 243/7/365 monitoring.[10]

Indie design startup, Creative Market, is being acquired by Autodesk.  Creative Market builds tools and communities for creators.

Zulip, a workplace messaging startup, was acquired by Dropbox

Private Placements[11]

(12 transactions noted that were over $10m)

Click on the Company name for the website or deal information.

App

Video chat app Tango raised a $280m Series D round at a $1b-plus valuation.  Alibaba led the round, investing $215m.  Prior investors, including Qualcomm, invested the remaining $65m.  Tango lets users send free text, photo and video messages from their phone, as well as access social networks and play games.  The Company is based in Mountain View.

Nigerian financial security app, i.Sec, raised $10m.  i.Sec’s product is access authentication middleware that uses out-of-band methods to authorize a user.

Software

cloudera, which combines a Hadoop-based platform with advanced system management and data management tools, raised $160m, at over a $1 billion valuation.

Base CRM, a post-PC CRM and sales productivity company, raised a $15m Series C round.

Verdasys, developer of a data protection platform, raised a $12m round.

Gaming

Funplus Game, a mobile social gaming company with worldwide players, raised a $74m Series B round.  FunPlus is based in Beijing with offices in San Francisco and Vancouver, Canada.

Gravie, which helps consumers buy health insurance, raised a $10m Series A round.

Marketing/Media

New York City-based, Percolate, raised $24m.  Percolate’s platform helps marketing professionals create content for social platforms.

Gigwalk, a mobile app for consumer packaged good companies to use a mobile workforce to measure locally “visibility” checks, to ensure that their campaigns are executed correctly.

Education

AltSchool, a collaborative community of micro-schools that offer a personalized “whole child” learning experience, raised a $33m Series A round.  AltSchool is base in San Francisco.

Social

Social media analytics startup, Seattle-based Simply Measured raised $20m

Agriculture

Agriculture focused, Blue River Technology, raised $10m  Blue River uses computer vision and robotics to deliver plant-by-plant solutions, increasing yields.

Please send me any comments or feedback. 

All the best,

Margaret Johns

Founder & Managing Director

We love to hear your opinions and comments at mjohns@bluelakepartners.com.

If you find this newsletter informative and interesting, please share.

Margaret Johns is the Founder and Chairman of BlueLake Partners, a boutique M&A investment bank based in the Greater Boston Area.  Prior to founding BlueLake she was an employee founder and Managing Director at Needham & Company where she worked in Corporate Finance in New York City and headed up its Boston office.  She now lives in Londonderry, New Hampshire with her husband, 16 year old step-daughter and three pugs.  When she’s not working with clients, FINRA or writing blogs she competes on the Granite State Penguins Masters Swim Team, skis, rides her bike or is out walking her pugs.

Content researched, edited and reviewed on a best efforts basis.

We make no claim to being comprehensive in our review, as the contents are companies and topics we, ourselves, find of interest.


[1] WSJ Moneybeat, Mar 10-14, 2014

[2] Certain information from Renaissance Capital, in addition to the SEC, Nasdaq.com, and other sources.

[3] A10 Networks S-1 Filing

[4] Amber Road S-1 Filing

[5] Border Free S-1 Filing

[6] Versartis S-1 Filing

[7] Akebia S-1 Filing

[8] MediWound S-1 Filing

[9] Sources:  TechCrunch, Company websites, other news media

[10] PR Newswire

[11] Sources:  TechCrunch, Company websites, other news media