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Sungard goes private

Crumbs! - biggest deal since Nabisco

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US security and continuity specialist Sungard has been bought by a group of private investors for $11.3bn - the largest such deal since Nabisco was bought by Kohlberg Kravis Roberts in 1988 for $25bn. Sungard owns UK disaster recovery firm Guardian IT.

The buyers include Bain Capital, the Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts, Providence Equity Partners and Texas Pacific Group. The group is led by Silver Lake Partners. The deal is a leveraged buyout - Sungard will be taken private and its shares removed from Wall Street.

Sungard shareholders will receive $36 for each share they own. Sungard's board of directors approved the deal and is recomending shareholders vote in favour. The takeover should close in the third quarter of 2005, assuming shareholders and regulators do not object.

Jamille Jinnah, managing director of placement and research house Almeida Capital, told El Reg: "We are going to see more of these kind of deals. Private equity groups have enough capital so we're going to see more and more companies being taken private."

Jinnah said: "Investors have more control over a company which is private rather than under public and market scrutiny. In the future it is going to get harder to keep talented people within public companies." Jinnah also believes the structure of such deals is likely to change with sellers keeping an interest in the firms they sell.

More details on Sungard's website here.®

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