SunGard is acquired for over $11 billion by a consortium of firms

Monday, March 28th 2005, 9:28 am

By: News On 6

WAYNE, Pa. (AP) _ In one of the largest deals of its kind, financial data company SunGard Data Systems Inc. has agreed to be purchased by a consortium of seven private investment firms for $11.3 billion, the companies said Monday.

The deal will be the biggest leveraged buyout of a public company by private investors since 1989, when Kohlberg Kravis Roberts & Co. paid $29.4 billion to acquire RJR Nabisco, according to Thomson Financial.

SunGard provides a variety of services, including developing computer software that helps other business manage data. Among other things, its systems help Wall Street brokerages and mutual funds process stock transactions and universities manage student records.

Under the terms of the agreement, SunGard stockholders will receive $36 in cash for each share of SunGard common stock they hold. The stock hit a 52-week high in Monday morning trading as shares rose nearly 10 percent, or $3.09, to $34.64 on the New York Stock Exchange.

The consortium, led by technology-focused investment firm Silver Lake Partners, includes Bain Capital, The Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co., Providence Equity Partners and Texas Pacific Group.

SunGard's board of directors approved the merger and it is expected to be completed in the third quarter of 2005, subject to stockholder and regulatory approval.

``This transaction offers great value to our stockholders and represents an endorsement of our business model, industry leadership and financial strength,'' said Cristobal Conde, president and chief executive officer of SunGard.

SunGard's senior management team and its business plan will remain largely unchanged after the sale, Conde said in a morning conference call with business analysts. He said that becoming a private company will help the company ``do things faster.''

SunGard serves more than 20,000 customers in more than 50 countries.

In light of the sale, the company said it has abandoned plans to spin off its Availability Services unit, which helps companies keep their computer systems running in the event of a natural disaster.

The unit accounted for about 40 percent of SunGard's business in 2003.