As reported by Amy Thomson at The Washington Post, in its second telecommunications buyout in as many days, the world's second-largest private-equity firm Carlyle Group has now agreed to pay about $2.6 billion to take Syniverse Holdings Inc. into private ownership. The deal comes on the heels of Carlyle agreeing to pay $3.36 billion to acquire CommScope.
Syniverse is a maker mobile-phone messaging and network technology that provides roaming and messaging services to mobile operators and cable and Internet providers. The Tampa, Fla., company, which traces its roots back to a GTE unit formed in 1987, had revenue of $482.9 million last year, as noted in today's Wall Street Journal.
Carlyle is offering investors $31 a share in cash, said Syniverse in a statement issued yesterday.
"Syniverse is an outstanding business that plays a vital role in the mobile ecosystem globally," said Carlyle managing director James Attwood. The transaction, funded with equity provided by Carlyle's $13.7 billion buyout fund Carlyle Partners V and debt by Barclays Capital and Credit Suisse Group, is expected to close in the first quarter of next year.
The Washington Post report notes that the telecommunications-gear industry, where many companies were hit with spending cuts amid the global recession last year, is rebounding as demand for mobile data services and network equipment increases. Private-equity firms are attracted to the industry because of the "explosive, accelerating usage of mobile Internet devices," said John Bright, an analyst with Avondale Partners in Nashville.
The telecommunications industry's history of turbulence, caused by shifting technologies, changing regulations as well as cyclical demand, has led to a "false pessimism that is causing people to overlook real value in these markets," Carlyle's Attwood, head of the equity firm's telecommunications and media group, said in a statement on the company's Web site.