The barbarians are back.

Experts are predicting a new wave of LBOs now that The Carlyle Group and Welsh, Carson, Anderson & Stowe jointly acquired Qwest's telephone directory business for $7.05 billion. 

The Qwest (Q) deal is the largest LBO since Kohlberg Kravis Roberts acquired RJR Nabisco in 1989 for over $30 billion. That deal sparked the book and movie "Barbarians at the Gate." 

Private equity players are licking their chops as they examine other blue-chip companies that may want to carve out, or sell, part of their businesses. 

The time is right for a wave of divestitures: Many companies are desperate to sell off assets to reduce debt levels. 

Buyout shops have amassed a combined war chest of about $120 billion, estimates David Barnes, national director of private equity coverage at the investment bank Houlihan, Lokey Howard & Zukin. 

The biggest players include Carlyle, Welsh-Carson, Kohlberg Kravis, the Texas Pacific Group and the Blackstone Group, as well as banks like Goldman Sachs Capital Partners and Credit Suisse First Boston Private Equity. "They are now circling like sharks," said Richard Morgner, head of mergers and acquisitions at the Los Angeles-based buyout firm Chanin Capital Partners. 

So who's buying what? 

Almost everything is on the table now because of depressed valuations. But a good place to start would be Qwest, which still needs to divest non-core assets to pay off its gargantuan debt load of $26.3 billion. 

It could sell parts of its U.S. West division, including its rural access lines, said Morgner. 

Private equity giants Thomas H. Lee Partners, Providence Equity Partners and Bain Capital, which made a $3 billion bid for part of Qwest's directory business, could seek this asset, say sources surveyed for this story. 

Another carve-out possibility is WorldCom's SkyTel wireless data business, say mergers and acquisitions sources. 

The cable industry also could be an extremely active area because the industry's key metric - price per subscriptions - has fallen significantly this year, said Morgner. 

"Many cable companies are trading at under $3,000 per cable subscription when Comcast said it would buy AT&T's Broadband cable business for over $4,500 per sub." 

That deal, which has yet to be completed, already has been adjusted down to $3,700 per sub.