Broadcom in 'advanced talks' to buy Symantec, says report

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Broadcom in 'advanced talks' to buy Symantec, says report

Broadcom is in 'advanced talks' to buy security giant Symantec as the chipmaker continues to diversify its portfolio, according to a Bloomberg report.

Broadcom could reach an agreement to buy Symantec within weeks, Bloomberg reported, though no deal has been finalized and talks could fall through. Symantec is the world's largest pure-play cybersecurity vendor, with annual sales of more than US$4.73 billion.

Symantec's stock soared 22 percent on the news, while Broadcom's stock fell five percent. Symantec declined to comment, while Broadcom didn’t immediately respond to a request for comment from CRN.

A Broadcom-Symantec deal would be the second marriage between a chipmaker and an anti-virus vendor this decade - after Intel acquired McAfee for $7.7 billion. That deal didn't end well: Intel sold the company for rather less than its initial purchase price.

The talks with Symantec come 16 months after Broadcom dropped its $117 billion bid to buy rival chipmaker Qualcomm, which was scuttled by US authorities over national security concerns. Since then, Broadcom has officially relocated its headquarters from Singapore to the USA.

Broadcom has aggressively diversified its business in recent years, purchasing data center networking provider Brocade for $5.9 billion in December 2017 and IT software giant CA Technologies for $18.9 billion in November 2018. The company, however, unloaded most of its security-related assets last year when it sold CA-owned application security testing vendor Veracode to investment firm Thoma Bravo for $950 million.

Symantec has been rumored to be an acquisition target previously, with Thoma Bravo said to be in the mix.

The last 14 months have been tumultuous for Symantec, culminating in the sudden May 2019 resignation of company President, CEO, and Board Member Greg Clark from all roles effective immediately. Since then, Symantec has been led on an interim basis by former Novellus Systems Chairman and CEO Richard Hill.

Clark's departure continued the executive brain drain atop Symantec, with President and COO Michael Fey leaving in December to take the CEO position at Mesosphere and EVP and CFO Nicholas Noviello announcing plans to depart Symantec in January.

Meanwhile, activist investor Starboard Value said in an August 2018 regulatory filing that it believed shares of Symantec were undervalued at the time of purchase, and that it hopes to change the makeup of Symantec's board to unlock more value. A month later, the company reached an agreement with Starboard to name three new independent members to the company's board of directors.

Symantec also announced in September that it had finished its internal probe into concerns raised by a former employee and deferred $12 million of revenue that had been recognized in the quarter ended March 2018. The probe identified certain behavior inconsistent with the company's code of conduct, and referred the matter to Symantec for appropriate action.

And in June, Guardian Australia reported that a February data breach at Symantec had given hackers access to account numbers, passwords, and a purported list of the company's prominent Australian clients. Symantec characterized the breach as a "minor incident" since it involved a self-enclosed demo lab that didn't host sensitive personal data and wasn't connected to the company's corporate network.

This article originally appeared at crn.com

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