Mergers and Acquisitions

Atto Bioscience Inc. of Rockville was bought by Becton, Dickinson & Co. for about $25 million in cash. Privately held Atto makes devices for analyzing interactions inside living cells.

HealthExtras Inc., a Rockville pharmacy benefit manager, bought Managed Healthcare Systems, a competitor in Florida, for up to $44 million in cash and stock.

QuadraMed Corp., a Reston health care information technology company, bought Florida's Tempus Software for $13.21 million in cash and stock.

EOIR Technologies Inc. of Woodbridge was sold to Markland Technologies Inc. of Ridgefield, Conn., for $19 million in cash and debt. EOIR, among other businesses, provides services to the U.S. Army's night vision laboratories.

Sitestar Corp. of Lynchburg said it would buy Virginia Link Internet of Galax, Va., for an undisclosed price. Both are Internet service providers.

Colfax Corp. of Richmond bought Parker Hannifin Corp.'s Zenith Pump division for an undisclosed price. Colfax is a privately owned maker of fluid handling and power transmissions.

American Systems Corp., a Chantilly information technology consulting company, bought True North Solutions, a Herndon information security company. Both companies are private, and terms weren't disclosed.

InterImage Inc. bought Canal Bridge Consulting LLC of Rockville for an undisclosed amount. InterImage is a software development company in Arlington, and Canal Bridge is a management consulting firm. Both companies are private.

YDI Wireless Inc., a Falls Church wireless broadband data provider, bought Ricochet Networks Inc. of Denver for $3.48 million in cash and stock. Ricochet is a wireless Internet service provider.

Private Equity and Venture Capital

American Capital Strategies Ltd. made a $31 million investment to fund the acquisition of Safemark Systems LP, a Florida maker of hotel-room safes, from Richards Capital Fund LP. American Capital funded a senior-term loan, senior subordinated debt, junior subordinated debt with warrants, and redeemable preferred and common equity, giving the Bethesda business development company a 75-percent ownership stake in Safemark with the other 25 percent owned by management. In a separate deal, American Capital invested $10 million in a recapitalization of Valley Proteins Inc., a Winchester, Va., recycler and renderer of food processing by-products.

Allied Capital Corp., a Washington business development company, completed three transactions last week. It made a $257 million long-term debt and equity investment in Advantage Sales and Marketing, giving it majority ownership. Irvine, Calif.-based Advantage Sales provides outsourced merchandising and market services to consumer packaged goods clients. Allied Capital also bought control of Financial Pacific Co., a Washington state-based lease financing company, for about $94 million in long-term debt and equity. Lastly, Allied sold portfolio company International Fiber Corp. to Swander Pace Capital, booking a $5.5 million gain on its equity investment. Allied provided $23.5 million in debt and equity financing to finance Swander's acquisition of the dietary fiber maker.

New Enterprise Associates of Baltimore led an $18 million third round of venture funding for Massachusetts-based Konarka Technologies Inc., a developer of solar energy technology. Other investors in the company's third round included Vanguard Ventures, Partech International, Prime New Energy, SDL Ventures, Good Energies Inc. and Presidio Venture Partners.

Grotech Capital Group led a $10 million series C round of venture financing of Bluefire Security Technologies of Baltimore. Grotech invested $6 million in the wireless communications security software company. Other investors include JK&B Capital, Walker Ventures, the Maryland Department of Business and Economic Development and the Maryland Angels Council. Bluefire has raised $17 million in venture capital.


CapitalSource Inc., a Chevy Chase business lending and investment company, undertook a series of debt financings in recent weeks. Wednesday it is expected to close a private offering of $300 million of convertible debt, bearing 3.50 percent and due 2034. Each $1,000 of debt is convertible into 31.4614 shares of common stock. That's a 30 percent premium to CapitalSource's closing stock price June 30. The company also added another $400 million to its borrowing capacity from Wachovia Capital Markets LLC, bringing its total borrowing capacity to $1.6 billion. Finally, CapitalSource recently completed an $875 million debt securitization, issuing bonds backed by commercial loans. Citigroup Global Markets Inc. and Wachovia Securities were joint book runners on the securitization. CapitalSource manages a business loan portfolio of about $3.2 billion.

Public Equity

Constellation Energy Group Inc. of Baltimore raised $226.9 million in a stock offering to fund part of the purchase of the R.E. Ginna Nuclear Power Plant near Rochester, N.Y. Wachovia Capital Markets underwrote the offering.

Guilford Pharmaceuticals Inc. sold 10 million shares of stock at $4.50 a share in a deal underwritten by UBS Investment Bank, CIBC World Markets Corp. and Citigroup.

Friedman, Billings Ramsey Group Inc. managed last week's follow-on stock offering by Allied Healthcare International Inc., which sold 4.5 million shares at $4.90 per share. Allied, based in New York, provides health care staffing services in the United Kingdom.

Compiled from staff reports and Bloomberg News.