Apax and JMI Equity have agreed to buy the software group, which sells its technology to oil and gas explorers and producers, from US investment group Fox Paine.
Paradigm, which has more than 700 customers and operations in the US, Europe and Asia, helps engineers to make drilling and production decisions by analysing seismic data.
The deal will allow Apax to tap into the potentially lucrative oil and gas markets as energy companies continue to drill in more challenging locations.
“Paradigm... is well-placed to benefit from strong tailwinds in the coming years as energy companies look to drill in more challenging locations,” said Ian Jones, a senior partner at Apax, which is based in London.
“The software it provides is the best in the market, leading to strong, established relationships with its customers and underpinning an attractive business model.”
Bank of America Merrill Lynch and Simmons & Co advised Apax, with UBS and Royal Bank of Canada providing debt financing. Jefferies advised Paradigm.
It is the latest tech deal for Apax, whose previous IT and software investments have included Autonomy, which it came out of in 2001. Mike Lynch’s firm went on to be bought by Hewlett-Packard for £6.2bn in August last year.