FORTUNE -- Later this month the Rhode Island State Investment Commission will hold its regular monthly meeting, during which it may decide to launch a secondary sale process for its limited partnership position in a private equity fund managed by Wellspring Capital Management. At issue is Wellspring's investment in United Sporting Companies, a South Carolina-based wholesale distributor of firearms, hunting supplies and marine accessories.
Unlike many other state pension systems, Rhode Island SIC doesn't have formal guidelines related to investments in controversial areas like guns. But after Newtown the SIC decided it didn't want exposure to any companies that produced or distributed "assault weapons" like Bushmaster AR-15's (which are listed among USC's offerings). So it asked Wellspring to sell the asset.
My understanding is that Wellspring actually had been seeking a buyer pre-Newtown, but that the school massacre made the divestiture much more difficult (just ask Cerberus, which so far has been unable to unload Bushmaster parent Freedom Group). It did have a bit of inbound interest early this year, but currently the process seems stuck somewhere between sluggish and inactive.
According to SIC minutes, there also was an expectation that USC would stop distributing such products after January 1, but that never happened. Either due to a change of heart or due to miscommunication between Wellspring and the SIC.
Unless a mystery buyer pops up with a term sheet in the next few days, SIC is going to have to make an interesting choice during its June meeting. Maintain its stake in the Wellspring fund, perhaps under the rationale that it didn't have any anti-firearm policy in place when the original commitment was made. Or try to do a one-off secondary sale at sub-optimal conditions (given that buyers would know they have a seller whose primary motivation is not financial).
Should be interesting… Also worth noting that SIC has exposure to fellow USC investor Summit Partners, but not in the relevant fund.
Sign up for Dan's daily email newsletter on deals and deal-makers: GetTermSheet.com
Google pays big to get into the social marketing biz.
FORTUNE -- Google (GOOG) yesterday announced that it had acquired social marketing company Wildfire Interactive, apparently after previously losing out on Buddy Media to Salesforce.com (CRM). A few notes, based on conversations with folks close to the situation:
1. How much? The reported sale price is $250 million, but multiple sources tell me that the total deal is valued at around $400 million MOREDan Primack - Aug 1, 2012 10:31 AM ET
|America's economic mobility myth|
|Treasury closes the book on GM bailout with final stock sale|
|Where should you put your money now?|
|Snowden docs had NYTimes exec fearing for his life|
|The economy: The 2014 outlook|