Renewed acquisition bid would leave Symantec with its consumer security business
A smaller, but still significant, version of the Broadcom acquisition of Symantec is on the table, as reports indicate that the chipmaker-turned-conglomerate is close to sealing a $10 billion deal to buy the security vendor’s enterprise unit.
The Lowdown: An announcement about the acquisition could come today when Symantec releases its quarterly earnings report, but sources tell finance media outlets that negotiations could stretch for several weeks as the two companies iron out details about how to split Symantec into two companies.
The Details: Specifics on the deal aren’t available, but reports indicate that Symantec would effectively exit the enterprise segment by shedding its B2B products to Broadcom. The deal would leave Symantec with its consumer products, such as Norton antivirus and LifeLock privacy monitoring, and its insurance business.
The Impact: If the new version of the Broadcom-Symantec deal comes to pass, and Broadcom takes over Symantec’s enterprise business, Broadcom will also take a significant portion of Symantec’s channel with it. Symantec’s consumer business has a significant retail channel, and many SMB resellers use Symantec consumer products in smaller accounts. The bulk of Symantec’s channel, however, is oriented to enterprise products.
Background: Last month, reports surfaced that Broadcom was looking to buy all of Symantec for $24 billion. For a time, the deal looked imminent, but talks broke off reportedly because Symantec wanted a higher valuation for the business. Symantec’s stock price plummeted as a result of the deal falling through. The deal is significant for both sides. Symantec continues to struggle with intense pressure from nimble competitors and a string of management shake-ups. Broadcom is looking to diversify its semiconductor business by acquiring more mainstream technology-product companies.
Channelnomics Point of View: The Broadcom acquisition of Symantec’s enterprise unit makes a lot of sense. Symantec is a strong provider of consumer security products, a segment in which next-generation security companies such as CrowdStrike and Carbon Black don’t play. Shedding the enterprise unit will leave Symantec with a significant business while freeing its B2B products for development under Broadcom.