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SunGard hires banks for potential IPO: Reuters

(Reuters) – SunGard Data Systems Inc has hired investment banks for a potential initial public offering that could value the financial technology company at as much as $10 billion, including debt, according to people familiar with the matter.

JPMorgan Chase & Co (JPM.N), Goldman Sachs Group Inc (GS.N), Deutsche Bank AG (DBKGn.DE), Barclays Plc (BARC.L) and Credit Suisse Group AG (CSGN.VX) have been tapped to lead the IPO, which may come later this year, the people said on Tuesday.

Private equity-owned SunGard will also work with some of these banks to explore an outright sale, the people added, asking not to be identified because the deliberations are confidential.

Spokespeople for SunGard and the banks either declined to comment or did not immediately respond to requests for comment.

Reuters first reported last month that SunGard was interviewing banks to explore a sale and IPO after it was approached by at least one company about a potential takeover. The identity of that company could not be learned.

One of the largest leveraged buyouts that preceded the 2008 financial crisis, SunGard is one of the longest-held investments in private equity history. It also an example of a so-called ‘club deal’ by multiple buyout firms. Private equity firms have fallen out of love with such deals because the performance of some of them has been poor.

SunGard was acquired for $11.4 billion in 2005 by Silver Lake Partners LP, TPG Capital LP, Bain Capital LLC, Blackstone Group LP, Goldman Sachs Capital Partners LP, KKR & Co LP and Providence Equity Partners Inc.

Based in Wayne, Pennsylvania, SunGard provides software and processing services for financial firms and also serves the education and public sectors. Last year, it spun off its disaster recovery unit, which represented about a third of its revenue.

Annual revenue at SunGard increased last year by 2 percent to $2.8 billion. As of Dec. 31, total debt was $4.7 billion and cash was $447 million. Adjusted earnings before interest, taxes, depreciation, and amortization was flat last year at $765 million.

(Reporting by Mike Stone and Greg Roumeliotis in New York; Editing by Steve Orlofsky and Christian Plumb)