Warburg Pincus Weighs Mach Deal

(Reuters) – Warburg Pincus is considering the sale of Mach, its Luxembourg-based business that provides roaming and billing services to mobile phone companies, four people familiar with the matter said.

The buyout firm has hired Barclays Capital to review options for Mach, which could fetch around $750 million if sold and includes Telefonica, Microsoft and Verizon among its customers, the people said.
Analysts said on Wednesday that Mach could be a target for software majors like Oracle and SAP if Warburg Pincus presses ahead with a formal process.

U.S. business software company Tibco might also rank among the suitors, according to analysts.
No sales information had been sent out to potential buyers yet, and there is no guarantee that Warburg Pincus will ultimately sell, two of the sources said.

Mach has been in private equity hands for almost a decade and could appeal to other buyout firms as well, the people said.

There has been recent private equity activity in the mobile outsourcing sector, with Carlyle taking U.S. group Syniverse Technologies private earlier this year for about $2.6 billion.

Demand for mobile data services and new applications is soaring and telecom companies are increasingly outsourcing these functions to companies like Mach to improve service and cut costs.

Warburg Pincus bought Mach in 2005 from Advent International for an undisclosed sum, reported at the time to have been about 600 million euros ($820 million).

Since then, the buyout firm has continued to add to the business through bolt-on deals and mergers, taking over rivals including Evenex, Cibernet and Germany’s Optel Informatik.

Headquartered in Luxembourg, Mach has offices in 12 countries and serves over 650 mobile network operators, processing more than half of the world’s roaming calls, according to its company website.

Warburg Pincus declined to comment. Barclays could not be reached for comment.

($1 = 0.733 Euros)

(Additional reporting by Sophie Sassard; Editing by Hans-Juergen Peters)