Security software maker Symantec to split into two public companies
Norton antivirus maker Symantec Corp (SYMC.O) will split into two publicly traded companies, one selling security software and the other providing data management, potentially making itself more attractive to suitors.
Symantec’s revenue growth has lagged the rest of the security software market in recent quarters, with slowing PC sales hurting demand for the company’s software, which often comes bundled with new computers.
“Symantec has been a headache name for tech investors over the last decade. It’s nice to see the board make a decision that strategically makes sense for the company and its investors,” FBR Capital Markets analyst Daniel Ives said.
A number of potential buyers, including Cisco Systems Inc (CSCO.O) and NetApp Inc (NTAP.O), will likely show interest in each of the companies Symantec splits into, Piper Jaffray analyst Andrew Nowinski said in a note.
FBR’s Ives said the “cash-cow” storage business could attract interest from private equity players.
“Post split, you have two companies, one focused more on cash flow and one focused more on revenue. So, put together, can it help revenue? I think it can, certainly, but you have to execute,” investor Tim Ghriskey told Reuters.
Michael Brown will continue as chief executive of Symantec and Thomas Seifert as chief financial officer, the company said. Brown took over as interim CEO in March after his predecessor, Steve Bennett, was fired.
The spinoff is expected to be completed by the end of December 2015, Symantec said.
Shares in the new data management business will be distributed tax-free to existing Symantec shareholders. The stock distribution ratio will be determined later, the company added.
Source: Reuters- Security software maker Symantec to split into two public companies
