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Boston Capital

World title helps

Celtics general partner Wyc Grousbeck. Celtics general partner Wyc Grousbeck. (Associated Press)
Email|Print|Single Page| Text size + By Steven Syre
Globe Columnist / June 27, 2008

Wyc Grousbeck, the Boston Celtics general partner, is about as visible as a professional sports investor can get at the moment. A world championship for a storied franchise after two dry decades will do that to you.

So what could that do for the prospects of a fund dedicated to sports business investments that Grousbeck has been quietly pitching in recent months? It surely can't hurt.

One person familiar with the fund idea described it as still developing, though Grousbeck is interested in raising about $200 million to invest in sports opportunities. He demurred when I asked him about the fund nearly two months ago and declined to talk again this week. He said it would be premature to talk.

Grousbeck was a general partner at Highland Capital Partners, the Boston venture capital firm, before he led an investment group that bought the Celtics in 2002. He returned to Highland on a part-time basis as an adviser two years ago.

He has been working on the sports fund with Mark Wan, a partner at Three Arch Partners, a California venture capital firm, according to a person who was briefed on the venture. Wan, a member of the Celtics ownership team, was also a business school classmate of Grousbeck's at Stanford.

Investment vehicles dedicated to sports opportunities are unusual but not unprecedented. Sports Properties Acquisition Corp., a blank-check company dedicated to sports investments, raised $200 million when it went public in January.

Robert Caporale and Randy Vataha of Boston-based Game Plan LLC are advisers to the company. Blank-check companies raise funds through public stock offerings and then seek an operating business to buy with the money.

. . .

As it turns out, there is no shortage of people in Boston who want to raise money, but don't want to talk to me.

Next up: Tagg Romney, the son of former presidential candidate and private equity chief Mitt Romney.

Tagg Romney and others are trying to raise about $200 million for a new private equity fund, which was first reported by Dan Primack at PE Hub, a private equity news website. A spokesman confirmed the efforts of the younger Romney, who was otherwise not available.

Romney is helping launch Solamere Capital with an interesting group of principals that includes Eric Scheuermann of Juniper Partners. Scheuermann was the former national finance director for the Romney presidential campaign. He's also the son-in-law of another former Massachusetts governor, William Weld.

Of course, Tagg's father made his mark, not to mention a huge fortune, as cofounder of Boston's Bain Capital.

. . .

Who would have ever guessed that short-term bond mutual funds would be able to keep so many lawyers busy? Then again, who could have imagined those funds were capable of losing so much money?

Two shareholders seeking class-action status sued Boston's Evergreen Investments this week over the fate of the $403 million Ultra-Short Opportunities fund, which revealed plans on June 19 to liquidate after suffering big losses. That fund managed $731 million at the end of March, according to the lawsuit filed in US District Court in Boston.

The Evergreen fund was hurt by a common culprit, mortgage-backed securities that made up about three quarters of the portfolio. It lost 18 percent of its value this month alone.

The lawsuit says the fund was pitched as an investment to "provide current income consistent with preservation of capital and low principal fluctuation." So much for that.

Evergreen declined to comment. The firm has plenty of company in court. Shareholders have sued Fidelity Investments and Charles Schwab Corp. over similar allegations about short-term fixed income funds.

. . .

Shareholders of TravelCenters of America LLC, who have watched their stock plunge 94 percent in the past year, sent the board a message this month. Fewer than half of the company's shares were voted to reelect independent director Arthur Koumantzelis and managing director Barry Portnoy, who appeared here in a column last week about an entirely different shareholder dispute.

Both men resigned. Remaining directors of the company, which was spun out of Hospitality Properties Trust of Newton last year, convened to select successors. Its choices: Koumantzelis and Portnoy, who reassumed their old roles. Koumantzelis was also appointed chairman of the audit committee. Go figure.

Steven Syre is a Globe columnist. He can be reached at syre@globe.com.

Correction: Because of a reporting error, the Boston Capital column in Friday's Business section incorrectly identified the national finance director for the presidential campaign of Mitt Romney. Spencer Zwick held that position. The column also incorrectly identified the father-in-law of investment executive Eric Scheuermann. He is William Nye Weld, not former governor William F. Weld.

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