FIS seeks sale of SunGard's public sector and education unit: sources

(Reuters) - Fidelity National Information Services Inc (FIS) FIS.N is seeking to sell SunGard Data Systems Inc's business that serves the public sector and education markets, hoping to fetch more than $1 billion, according to people familiar with the matter.

The sale process follows FIS’ acquisition of payment processing peer SunGard from buyout firms in November for $9.1 billion, including debt. It illustrates its desire to focus on areas of core competence, such as retail and enterprise banking, payments, capital markets, wealth management and insurance.

FIS is working with investment bankers on an auction of the public sector and education division, which may attract the interest of other companies in the sector and private equity firms, the people said this week.

The sources asked not to be identified because the sale process is confidential. A FIS spokesman could not immediately be reached for comment.

SunGard’s public sector unit provides everything from software allowing municipalities to communicate and plan meetings with residents, to prison management and public safety software, according to its website.

Its education unit helps with student information management, finance and human resources for school systems for grades K-12.

The public sector and education unit generated adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $49 million in the first nine months of 2015, according to a regulatory filing.

FIS Chief Executive Gary Norcross said on a Feb. 9 earnings call that the company would consider shedding assets that do not fit with the company’s overall strategy.

FIS sold a healthcare business that handled benefits administration and account processing for healthcare providers for $335 million in 2012 to private equity firm Lightyear Capital.

In 2011, SunGard sold its post-secondary education business to private equity firm Hellman & Friedman LLC’s Datatel, a software developer for colleges and universities, for $1.78 billion. That company is now called Ellucian.

Reporting by Liana B. Baker in New York; Editing by Steve Orlofsky