Private Equity / Buyout Funds are Hungry for TMT Assets

Implications: Private Equity Funds and Buyout Funds renewed their interest in telecoms and media assets in recent month after losing interest in that type of operations in the early part of the decade due to the Internet bubble burst. We will see more bids for telecoms, cable and media company by these funds in the upcoming months.

Analysis: After losing the race for Alltel (the top Tier II wireless carrier in the US) buyout to TPG and GS Capital Partners earlier this month, Providence Equity Partners and its partner in the bid for Alltel KKR are looking for a new target in the TMT sector. Blackstone also fell short on several recent telecoms bids (Alltel in the US and Telecom Italia in Italy just to name a few) is also looking for attractive telecom and media targets in the developed world. As we get closer to the year's end and throughout the early part of next year, we should see more private equity / buyout funds bids for large telecom and cable TV carriers and other media outfits in the US and Western Europe. Rumors say that there may be a bid for Sprint-Nextel from PE / Buyout funds in the very near future which ensures a very dynamic TMT environment in the upcoming months.