Fund to Target High-Growth Arkansas Medical/Biotech Companies

AIF Invests $4M in Memphis Biomed Ventures II

June 30, 2006 | Little Rock, AR -- The Arkansas Development Finance Authority’s (ADFA) venture capital program today officially closed on its 4^th venture investment.  The $4 million commitment was awarded to Memphis Biomed Ventures II, L.P. (MBV), a private venture capital firm building a $50 million diversified portfolio of equity investments in high-growth medical device and biotechnology companies.
 

MBV’s principal office is in Memphis, TN.  The firm focuses its investment activity primarily in the Southeastern (including Arkansas) and Midwestern regions of the United States.  This capital pledge brings with it a commitment from MBV’s management team to consider all credible deals coming out of Arkansas that fit within its investment parameters.  To facilitate this, MBV will organize and maintain a deal origination system in Arkansas which includes an annual screening of UAMS technologies, training lectures for interested technology transfer and academicians in how to commercialize medical technology, introductory events for business people interested in building medical technology companies and an inclusion of appropriate Arkansas technology leaders in MBV’s annual Musculoskeletal New Ventures Conference.  In addition, for those Arkansas technology transfer offices desiring it, MBV will provide input on how to package and present what makes for a more compelling investment opportunity to the venture capital community. 
 
MBV anticipates investing in an aggregate of ten (10) to fifteen (15) entities in the health care industry, including medical device and biotechnology companies with a particular interest in companies developing product solutions for musculoskeletal disease. The fund expects to invest at various stages of development from seed and early stage financings to later-stage deals.
 
This is the 4^th capital pledge since the passage of the Venture Capital Investment Act (The Act) in 2001.  The Act authorizes ADFA to make a capital guaranty of up to $70 million to capitalize a private institutional partnership fund for the state of Arkansas. Its goal is to invest in professionally managed venture capital funds who will be visible and who will aggressively pursue venture investment opportunities in Arkansas.

About the Arkansas Development Finance Authority

The Arkansas Development Finance Authority is committed to responding to the changing needs of Arkansas’ growing, increasingly diverse population and business community. Since its creation in 1985, ADFA has become the state’s largest source of low-cost financing for low-to-moderate income housing development, small industries, government, education, agricultural business enterprises and healthcare. Through the issuance of taxable and tax-exempt bonds and notes, the administration of private and public grants and partnerships with state and federal agencies, ADFA gives Arkansans the most cost-effective financing choices possible. In 2001, bond guaranty legislation was modified to allow ADFA to utilize credit enhancement and state tax credits to finance “fund of funds” venture capital investments. At this time the $70 million Arkansas Institutional Fund (AIF) was created.

About the Arkansas Institutional Fund

In an effort to strengthen the venture capital network in Arkansas and promote economic growth within the State, the Arkansas Institutional Fund (AIF) is authorized to invest in professionally managed venture capital funds that in turn make risk capital more accessible to promising Arkansas firms.

About Cimarron Capital Partners

Cimarron is a leading national investment management firm specializing in regional private equity. The firm serves as fund manager for the Arkansas Institutional Fund (AIF).