4th Madrona fund raises $250 million in venture capital

Seattle's Madrona Venture Group is announcing today that it closed its fourth venture fund, raising $250 million to continue investing in early-stage Northwest technology startups.

"We're going to stick to what has worked well," said managing director Matt McIlwain.

McIlwain noted that among Madrona-backed companies, four were sold and one went public in the past 18 months.

The fund exceeded its target of $225 million, with all of Madrona's existing institutional investors signing up, including the University of Washington.

Also participating are several new individual investors and institutions, including Cambridge and Oxford universities.

Washington Mutual

Stock sees gains after 16-year low

Washington Mutual stock rose 6.9 percent Tuesday after falling 17 percent to a 16-year low Monday.

"If you take a look at Washington Mutual, even though its mortgage business is horrible, even though it has these terrible loan losses in its portfolio that have yet to be recognized, it also has one of the strongest retail-banking businesses in the country," said Richard Bove, an analyst with Ladenburg Thalmann.

The Seattle-based lender rose 43 cents to $6.68 Tuesday. It's down 51 percent this year, however.

Pacific Bioscience

Ex-Ultreo CEO named president

Pacific Bioscience Laboratories said Tuesday it had appointed former Ultreo Chief Executive Jack Gallagher as its new president.

Gallagher is a former executive at Philips Oral Healthcare and Drake Bakeries. He founded power-toothbrush maker Ultreo in 2003 but stepped down from his CEO post in February.

Seattle-based Pacific Bioscience makes the Clarisonic Skin Care System, a brush that uses sound technology to cleanse the skin.

Boeing

Australian planes delayed until 2010

Boeing said a $1 billion program to supply Australia with six surveillance planes is now delayed until 2010. Last week, the company had said the planes would be delivered next year.

The first two planes fitted with electronic warfare systems will be delivered to the Royal Australian Air Force in early 2010, Boeing spokesman David Sloan said Tuesday.

The other four will be ready by the end of that year, he said, attributing the delay to "systems integration" challenges.

Corbis

Critics stop changes to Ill. publicity law

Legislation to amend Illinois' publicity-rights law was blocked last week by a parliamentary maneuver that prevented the bill from advancing to the governor for his approval, the Chicago Tribune reported.

One of the key provisions would have protected entities that license rights to photos, videos or other materials from liability under the law, which prevents the unauthorized commercial exploitation of one's image.

Seattle-based Corbis pushed for legislation after facing a legal challenge over its sale of pictures on the Internet. The estate of James Brown sued Corbis in Cook County, Illinois, for allegedly violating the late singer's publicity rights.

The bill, approved by the Illinois House on May 30, will be put on hold until lawmakers return in November.

Microsoft

Icahn: Yahoo board "sunk to new low"

Carl Icahn, the billionaire investor trying to gain control of Yahoo, said the company's board has "sunk to a new low" as it avoids a Microsoft takeover.

An employee-compensation plan, which takes effect if there's a change of control at Yahoo, is "reprehensible," Icahn, 72, said Tuesday at the New York Financial Writers' Association dinner.

Still, the policy won't stop Icahn's plan to get Microsoft to buy Yahoo in "a marriage made in heaven," he said.

Icahn is trading barbs with Yahoo's directors as they prepare for the annual shareholders meeting Aug. 1. He is building investor support to vote out the board, which he blames for blocking a Microsoft purchase.

Microsoft walked away from a $47.5 billion bid for the Internet company last month after Yahoo said the offer was too low.

Nation and World

Economy

Growth rate revised upward in Japan

Japan raised its reading for economic growth in the first quarter, due mainly to a stronger-than-expected increase in capital investment.

Japan's gross domestic product, or the total value of the nation's goods and services, grew at an annual pace of 4.0 percent in the January-March period. That was up from a preliminary reading of 3.3 percent, revised figures released today by the Cabinet Office show.

On a quarterly basis, GDP grew a revised 1.0 percent, stronger than the government's original estimate last month of an 0.8 percent expansion.

The numbers beat forecasts by economists surveyed by Dow Jones Newswires, who predicted a 0.9 percent rise for the quarter, or annualized 3.8 percent growth.

Growth in capital expenditures was a key factor in the revised GDP figures. They posted a 0.2 percent quarterly rise, markedly better than a preliminary reading of a 0.9 decline, the government said.

Energy

XTO Energy buying Hunt Petroleum

XTO Energy said Tuesday it is acquiring privately held Hunt Petroleum for $4.19 billion in cash and stock in a deal made more attractive by high oil and gas prices.

But the deal could become tangled in a feud roiling the descendants of famed Texas wildcatter H.L. Hunt. The lawyer for one of Hunt's great-grandsons, who is suing his own family over billions held in trust funds, vowed Tuesday to block the sale. He considers the price too low.

Compiled from Seattle Times staff, Bloomberg News, the Chicago Tribune and The Associated Press