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Quick payday on single cell sale

VC investors get quick double-digit return with DVS-Fluidigm deal

A quick turnaround from first financing to takeout netted investors in DVS Sciences Inc. an impressive return in a short time.

On Jan. 29, Fluidigm Corp. (NASDAQ:FLDM) announced plans to acquire fellow microfluidics company DVS for about $207.5 million. DVS investors will receive about $125 million in cash and $82.5 million in Fluidigm stock.

In July 2011, DVS raised $14.6 million in a series A round led by 5AM Ventures. Pfizer Venture Investments; Mohr Davidow Ventures; Roche Venture Fund; and the Ontario Institute for Cancer Research also participated.

5AM's Andrew Schwab told BioCentury the return was a bit less than 14x because of equity held by management, but noted it was still a great deal for investors. "It was one of our best multiples to date," he said.

The deal gives Fluidigm a suite of marketed single-cell protein analysis systems, including DVS's CyTOF2 mass cytometer, which applies mass spectroscopy to flow cytometry to efficiently study intracellular networks and disease state transitions (see BioCentury, July 18, 2011).

Fluidigm said the technologies would complement its own single-cell genomics technologies.

While the round trip was quick for investors, DVS had been working on the technology for almost 10 years.

The company was founded in 2004 and had been developing the technology in collaboration with researchers at the University of Toronto, primarily supported by grant funding, Schwab said.

The series A round was mainly used to scale up production of the instruments and begin commercialization.

"It's a great technology that lots of people wanted, as you can see the revenue growth and how quickly that business scaled," Schwab said.

In 2012, DVS had revenue of $11.9 million. For the first nine months of 2013, revenue was $18.5 million.

To fund the cash portion of the deal, Fluidigm raised $175 million through the sale of convertible senior notes due 2034.

Last week, Fluidigm was up $4 (10%) to $45.12.

- Stephen Hansen


EPS watch
Company 4Q13 EPS est 4Q13 EPS actual Outcome Growth from 4Q12 1/31 cls Wk chg

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