Private Equity Still Hot For Tech Sector BuyoutsPrivate Equity Still Hot For Tech Sector Buyouts

Marking the latest private-equity-backed buyout of a major technology firm, a group of investors led by Oak Hill Capital Partners has acquired U.K. business process outsourcer Vertex Data Science for about $430 million.

In addition to Oak Hill, the buyers include GenNx360 Capital Partners and Knox Lawrence International. Vertex is a subsidiary of the British diversified utilities conglomerate United Utilities. The sale, formally announced Jan. 15, is expected to close by the end of March.

Vertex, with 9,000 employees, provides a range of BPO services to businesses in the United States and the United Kingdom, including customer management, HR management, and financial management services. Customers include Marks & Spencer and Hydro One.

The deal is an indication that the private equity boom of 2006 is poised to continue through this year. The value of all private equity deals last year was $370 billion -- about twice the total racked up in 2005, according to Thomson Financial. Observers suggest that easier access to capital and companies' desire to avoid the regulatory spotlight of public markets are driving the move toward going private.

Some peg the trend's beginning to the $11.4 billion buyout of SunGard Data Systems in August 2005 by a consortium of top private equity firms. Since then, a number of other major tech buyouts have raised eyebrows from Silicon Valley to London, including the $17.6 billion buyout in September of Freescale Semiconductor by The Blackstone Group.