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Rating:Seven PE Firms Buy Sungard for $11.3 BN Not Rated 0.0 Email Routing List Email & Route  Print Print
Monday, March 28, 2005

Seven PE Firms Buy Sungard for $11.3 BN

by: Theresa Sim

Seven private equity firms led by Silver Lake Partners have finalized a buyout of Sungard Data Systems for approximately $11.3 billion. Sungard made the announcement on Monday.

Executives from both Sungard and the private equity firms sought to reassure Sungard's customers that it is business as usual for the software and services company.

While Cristóbal Conde, Sungard's president and chief executive officer, stated "our customers and employees should know that it is business as usual, now and following the completion of the transaction," questions abound about key Sungard products in the mutual fund space.

Sungard provides mutual fund shareholder recordkeeping through its InvestarONE product and fund accounting through InvestONE. Sungard's Investment Management division provides portfolio management, trading, investment compliance, and other services to investment managers.

A spokesman did not immediately return a call seeking comment.

Glenn H. Hutchins, cofounder and managing member of Silver Lake Partners, also reiterated the firms' commitment to a long-term vision: "our interests are aligned with the long-term interests of SunGard's customers and employees. SunGard will continue to focus on meeting the needs of all of its customers by delivering cutting-edge technologies and providing the very high level of service its customers are accustomed to receiving."

Sungard said its senior management would remain in charge of the company, and that it would continue to be based out of Wayne, Pennsylvania.

Silver Lake led a group of six other private equity firms, including: Bain Capital, The Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co. L.P., Providence Equity Partners and Texas Pacific Group.

Sungard shareholders will receive $36 in cash for each share of stock held. Sungard's $500 million in bonds will remain outstanding.

The transaction is expected to close in the third quarter of 2005. Sungard's board of directors has already approved the transaction.

The private equity firms will also finance the deal through debt financing from JPMorgan, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. and Morgan Stanley. Credit Suisse First Boston and Lazard provide fairness opinions to Sungard and its board. Shearman & Sterling and Morgan, Lewis & Bockius advised Sungard.  

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