Welcome back to Baby Breakerdom! This week's quest to find budding Rule Breakers brings another big biotech payoff and an early indicator that buyouts will be all the rage during 2006.
We begin this week with GeneOhm Sciences, which specializes in what's become known as molecular diagnostics. According to the company's website, its tests effectively peer into the composition of nucleic acids to find Group B Streptococcus and other malignancies, replacing traditional skin cultures. Though the idea has yet to create mass appeal, some big firms have become interested in the technology. Most notable among them is medical products supplier Becton, Dickinson (NYSE: BDX ) , which Tuesday acquired GeneOhm for $230 million.
VentureWire reports that it will be an all-cash deal, yet incentives could offer investors up to $25 million more in milestone payments. There's no word on just how much venture firms stand to make, though several were involved in backing the company. VentureWire reports that Wasatch Advisors, Partners Health Care System, Posco BioVentures, and the VC arm of Kaiser Permanente, among others, had put more than $70 million into the firm since it was founded in 2001.
The deal is made even more interesting by our next bit of news: Private equity fund-raising rose dramatically during 2005. According to Private Equity Analyst, all firms in the sector combined to raise $151.8 billion, a 65% increase over 2004. VC firms weren't atop the heap, however. Buyout firms accounted for nearly 70% of all the money raised.
That could signal a return to buyouts during 2006, especially when you consider the amount of cash on the books at former Rule Breakers Apple (Nasdaq: AAPL ) , with $8 billion, Google (Nasdaq: GOOG ) , with $7 billion, and Cisco (Nasdaq: CSCO ) , with $13 billion. Indeed, for a cold winter, it seems the investing waters have suddenly become very warm for the Rule Breakers among us.
Sadly, there were no Baby Breaker public offerings this week, which means it's time to say goodbye. See you back here next Friday, when we continue the quest to find the next ultimate growth stock.
For more Rule Breaking Foolishness:
- Did you catch our last installment of Baby Breakers?
- Find out how to spot technology paydays.
- It's Cramer vs. Cramer!
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Fool contributorTim Beyerswonders how much he'd get in a buyout. Any takers out there? Tim didn't own shares in any of the companies mentioned in this story at the time of publication. You can find out what is in his portfolio by checking Tim's Foolprofile. The Motley Fool has an ironcladdisclosure policy.