Broadcom To Seal $10-Billion Buyout Deal With Symantec

FILE PHOTO: Computer chip maker Intel's logo is shown on a gaming computer display during the opening day of E3, the annual video games expo revealing the latest in gaming software and hardware in Los Angeles, California, U.S., June 11, 2019.

Microchip manufacturer Broadcom Inc is in serious negotiations to acquire Symantec Corp's enterprise business to the tune of $10 billion, weeks after talks to take full ownership of the entire corporation collapsed.

The revival of the business talks could drag on for a few more weeks but it is possible that a contract can be sealed when Symantec posts its earnings report this week, people briefed on the acquisition bared. But sources also said that the discussions could still fail, much like the acquisition that was carried out earlier this year.

Stocks of Symantec were up 15% in the after-hours session, while those of Broadcom dropped 1.5%. Symantec, which is worth $12.63 billion in the market today, walked out of negotiations last month to sell itself to Broadcom over a price dispute, Wall Street reported.

Symantec is hounded by dismal sales due to stiff rivalry with more aggressive competitors and has witnessed several high ranking chief executives resign from the company recently, while the software giant faces an ongoing probe by US regulators regarding irregularities in its finances.

Broadcom was close to making public a deal to buy Symantec middle of July this year for $28.25 per share that would have given the group a market price of about $20 billion. But the deal was called off moments after Symantec slashed its price offer to under $28 a share.

The Mountain View, California-headquartered Symantec is engaged in security and software technology for enterprises, small companies and clients, the latter through its Norton facility. Its small business segment focuses more on Cloud-computing tech.

Meanwhile, sources disclosed that they do not see many advantages in merging the two companies. One analyst said Broadcom and Symantec offer contrasting expertise and do not really provide for a diverse set of synergies.

Symantec has been struggling to cope with sales in the last four quarters, punctuated with the surprise resignation of top honcho Greg Clark last May. Since then, the company has worked temporarily with erstwhile Novellus Systems chief executive officer Richard Hill to lead its operations.

A Symantec-Broadcom deal would mark the second union between an anti-virus seller and a chip-maker this decade, culminating 8 years after Intel bought McAfee for $7.8 billion. The substantive cooperation did not succeed as expected, and Intel ended up spinning off McAfee to private equity company TPG in a $4.2 billion deal in 2016.

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