Data room deals

With the advent of the electronic data room and its increasing popularity over that of traditional, physical sites for bidders to conduct due diligence, a proliferation of providers has created a wealth of choices for end users.

Virtual data rooms allow the seller of an asset to post information in the form of PDF and TIFF files on an extranet that potential bidders can then access for due diligence purposes. Ideally, these help a GP conserve time and resources while boosting efficiency compared to the use of physical data rooms.

A recent client update from law firm Debevoise & Plimpton offers some helpful nuggets of advice on choosing the right provider and getting the best price:

Identify what functionality you need: System compatibility, setup and administrative simplicity, user-friendliness, speed of access, and customer support are some key features that purchasers of electronic data room products should keep an eye out for. For advice and recommendations, M&A lawyers and bankers are good sources.

Solicit proposals from multiple providers:With more and more providers of electronic data room services emerging on the market, a GP can play the providers off one another to get a better price. One part of the pricing structure to pay particular scrutiny to are ?scanning charges.? The price per page can range from $.70 to $1.45 per page based on the total number of pages to be uploaded into the data room, and scanning charges can add another $.23 to $.25 per page to the costs.

Diligence the security precautions: Virtual data room providers should have an independent security audit done on their websites to test how effective their security precautions are in terms of fending off hackers and the like. If a security audit is unsuccessful, the provider’s website may not be secure from intruders.

Assess the available features: Typically included along with the basic price per page are features such as general project management, electronic document uploading, index and website creation, web hosting, reports, customer service, a search feature, training, a Q&A feature, and a DVD of the data room. These tools can streamline and simplify the administration of the data room.

Post-sale impact: Buyers of the company often find a well organized data room to be of value post-transaction – and may consequently be willing to pay a premium on the purchase price to get its hands on a DVD of the data room material.

Alternext Amsterdam and Brussels approved
The Dutch Ministry of Finance has given the green light for the launch of Alternext Amsterdam, granting a license for the exchange-regulated market that will target small and medium-sized companies. With legal and technical matters settled, Alternext Amsterdam is now open for business, and the first listing is expected to take place in the second half of this year. Alternext Amsterdam is an initiative brought forth by Euronext, which also launched Alternext in Paris last year, where the new market has a combined market capitalization of close to €2 billion and had attracted 37 listings as of the end of May. Meanwhile, Euronext has also announced the launch of Alternext in Brussels, effective as of June 20. Peter Paul de Vries, director of the Dutch Investors’ Association, was quoted in a press statement announcing the Alternext Amsterdam launch: ?Euronext’s plan to set up an Alternext market in Amsterdam as well as in Paris and Brussels could provide a boost for Amsterdam. However, in order to protect investors, Euronext Amsterdam needs to make sure it pays close attention to the quality of the companies it lists, just as EuronextParis does.?

Triago-X appoints board ahead of Euronext listing

French private equity secondary specialist Triago-Xhas appointed a board of directors ahead of its announced listing on Alternext of Euronext Paris. Javier Echarri, Olivier Laury and Vincent Remay have been appointed as company directors at Triago-X until 2012. Triago-X announced in May that it would be pursuing a flotation on Alternext in order to raise funds to expand the business. At the time, the firm declined to comment on an expected pricing or timing of the IPO, but sister online publication PrivateEquityOnline understands that a listing is likely to take place in late June or early July. Javier Echarri has been secretary general of the European Private Equity and Venture Capital Association since 1999. Olivier Laury is a director of Bouygues Telecom, having joined the group in 1983. Vincent Remay is an advisor to the chairman of Euronext and is responsible for product development. Founded in 2004, Triago-X has a team of 22 people operating out of offices in Paris and New York. Part of the Triago Group, the firm reported a turnover of €5.7 million ($7.1 million) and a net profit of €1.9 million for the financial year ended March 31, 2006.

Apollo listing to co-invest
Apollo Management, the New York private equity and capital markets investment specialist, is telling limited partners to make way for a potentially significant new coinvestor – Apollo’s planned publicly traded investment vehicle. The vehicle, called AP Alternative Assets, has raised $1.5 billion. It will eventually invest half of its capital in Apollo’s private equity activities and the other half in capital markets investments, although initially most of the vehicles’ investments will be in Apollo’s capital markets businesses, which include listed business development company Apollo Investment Corporation as well as Value Investment Fund, a distressed vehicle. Apollo head Leon Black noted in a communication that AP Alternative will be a co-investor in deals done by Apollo’s sixth private equity fund, which held a final close on $10.1 billion (€7.8 billion) in January. The listed vehicle will not represent more than 15 percent in any Fund VI deal.

London-based buyout firm Permira was attacked in late May by the GMB, a trade union representing a minority of workers at nationwide roadside recovery service the Automobile Association (AA), which the private equity firm acquired alongside CVC Capital Partners in July 2004 for £1.75 billion (€2.56 billion, $3.3 billion). The GMB placed an advertisement in the business section of London newspaper Evening Standard showing a photograph of Permira’s managing partner Damon Buffini and accusing the firm of unfair dismissal of AA workers. According to the GMB, the ?venture capitalists that run the AA? have laid off approximately 3,300 of the AA’s 10,000 workers. Twenty-four protest meetings were planned across the UK, the first of which took place in London on May 23. The GMB also tabled a parliamentary motion, 2079, as part of its campaign.

TH Lee cuts Refco loss
Thomas H. Lee Partners, the Boston private equity firm that suffered a significant loss on its investment broker Refco, has reached a settlement with Bawag, an Austrian bank. THL announced last month that Bawag will pay the firm at least $84 million over the next two years as part of a settlement with the US Department of Justice. US prosecutors and investors in Refco blamed Bawag for helping former chief executive Phillip Bennett and others pull off an elaborate balance-sheet fraud that eventually sank Refco. The payout to THL could reach as much as $100 million if Bawag is sold by its parent company OeGB, for more than €1.8 billion. OeGB is currently attempting to sell the bank. The settlement is part of a broader $675 million asset relinquishment agreed to between Bawag’s parent and the US government.

Apax communications pro heads to Barclays
Siobhan Loftus has left global private equity firm Apax Partners and will become director and head of corporate communications at Barclays Capital, the investment banking arm of the UK’s Barclays Group, this summer. At Apax, Loftus was director of marketing with responsibility for the development of the Apax worldwide brand. In her new role, she will be responsible globally for public relations, internal communications, advertising and brand, as well as ensuring coordination and integration of corporate communications with other business areas within Barclays Group. Loftus will report to Rich Ricci, Barclays Capital’s chief operating officer.

Mesirow’s PE group promotes fund admin pro
The private equity group of Chicago-headquartered financial services firm Mesirow Financial has promoted Mary Kay Wik to senior vice president. Wik, 46, joined the firm in 1986 and leads the private equity team’s client service, reporting and fund administration efforts. Wik is a member of the Illinois Venture Capital Association and the Private Equity CFO Association. She received her bachelors of science from Minnesota State University and an MBA from DePaul University in Chicago. At the same time the firm announced Wik’s promotion, Mesirow also said Michael Barrett has been promoted to managing director in the firm’s private equity group, following the 22 years Barrett has spent at the firm. Mesirow was founded in 1987, has almost $30 billion in assets under management, and is staffed by over 1,000 employees. Its private equity division was launched in 1982.

Updata Partners hires VP of finance
US East Coast-based venture firm Updata Partners has added Greg Olear as vice president of finance at the firm. Prior to joining Updata, Olear had served as VP of finance at streaming multimedia software provider Digital 5. Earlier in his career, Olear had spent time as Director of Financial Accounting and Treasury Operations at research facility Sarnoff Corporation. Before switching over to Sarnoff, Olear had spent time in leadership positions at KPMG, where he focused on assurance, accounting and financial advisory services. Olear holds a bachelor of science in commerce from Rider University and is a licensed certified public accountant in New Jersey. Updata has $250 million of capital under management and invests in early and growth stage IT companies. The firm is based in Reston, Virginia and Red Bank, New Jersey.