The seven-year old technology buyout firm, had originally planned to take the company public, but a $420 million sale to Electronic Data Service proved irresistible.
Accel-KKR bought Saber in 2005 for an undisclosed price. Soon after, the firm carved out the neglected public-sector division of Covansys Corp. Accel-KKR paid $40 million in 2006 for the unit and added it to the Saber platform. Accel-KKR quadrupled Saber’s sales in its two years of ownership, and by 2007 Saber had the scale and customer base to garner the attention of large public players such as EDS, says Managing Director Ben Bisconti.
Saber marked Accel-KKR’s first deal in government software and technology services, says Managing Director Rob Palumbo. With $40 billion in annual spending on IT by state governments, Accel-KKR sees the sector as an enormous opportunity.
Saber’s founders, brothers Nitin and Karan Khanna, worked closely with Accel-KKR through the investment cycle, and Nitin Khanna will retain a 7% stake in Saber following the acquisition by EDS. He will run Saber under its new ownership, assuming the role of head of EDS’s state IT software and services platform.
Accel-KKR, created by venture firm Accel Partners and LBO shop Kohlberg Kravis Roberts & Co., operates independently from its namesakes while maintaining relationships with each. After closing its second fund last year, Accel-KKR expects to make two to four investments overall each year, Bisconti says.
No deal for Sallie Mae
The investor group, which also included Bank of America Corp. and JPMorgan Chase & Co., originally offered about $60 per share for the company. In October, the investors said that federal student loan legislation, recently signed into law by President Bush, coupled with weaker economic conditions, have made the price agreed upon in April unacceptable. The group then offered $50 a share. Last week, Sallie Mae was trading for about $28 a share.
Blackstone nixes Nufarm deal
The Blackstone Group
The takeover group launched its bid in early November and was granted a period to perform exclusive due diligence on Nufarm. That period expired last week. Nufarm is one of several agrochemical companies that private equity firms have targeted recently. In October, the U.K.-based
Highland reconsiders Delphi
Delphi’s current plan calls for an investment of as much as $2.55 billion from hedge fund
Delphi has been operating under bankruptcy court protection since October 2005.
Cerberus out of running for Norther Rock
The battle for Northern Rock has been whittled down two bidders, after the U.S. private equity firm
Sources close to the bank told the New York Times that only two bids were being seriously considered by the Northern Rock board and its advisers. Virgin Group remains the preferred bidder, while shareholders apparently favor a proposal from a consortium led by Luqman Arnold, the former CEO of Abbey National.
TA makes Tactical move