Previously Symantec acquired Veritas in an all-stock deal valued at roughly $13.5 billion, but now the company is looking to sell it for less than half of this original value.
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Veritas is its information management business arm and is a flagship platform of traditional software. Over the past ten years, the company already returned $10 billion to shareholders. The company estimates that it would receive approximately $6.3 billion in net cash proceeds. Analysts expect that Symantec will post $1.86 earnings per share for the current year.
“Now they actually get a brand new lease on life when it comes to focusing on their core security DNA because the Veritas storage piece has been an enormous black cloud on the Symantec story for a decade”, FBR Capital Markets analyst Daniel Ives stated on Tuesday.
Symantec first announced last fall that it would be separating its two businesses to reduce complexity and boost growth, and has been seeking buyers for Veritas for several months, according to Reuters.
Partners Mark Plotkin and David Fagan at Covington & Burling advised on the buyout’s regulatory issues for Carlyle while a team at Latham & Watkins’ Washington DC office also worked on deal that is expected to close by the end of the year. Bill Coleman, CEO at Cassatt Corporation, who is also on the board of members of Symantec, will be appointed chief executive at Veritas. On the other side, BofA Merrill Lynch, Morgan Stanley and UBS Investment Bank were financial advisors to Carlyle and GIC. “We are wholly behind growing this business and growing a company that we hope to take public in the future”, Patrick McCarter, a Carlyle managing director said. Alston & Bird LLP, Allen & Overy, Latham & Watkins LLP, and Covington & Burling LLP represented The Carlyle Group.
Symantec on Tuesday also reported worse-than-expected drops in revenue and profit in its fiscal first quarter that ended on July 3.
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TOTAL S.A. (TOT) of the Basic Materials is up 0.26% this morning at $49.96 and 153458 shares. The company has watched its dominance in cyber security erode as hackers found ways to thwart key security products, including its antivirus software. The Information Management segment targets restoration and back-up, archiving and eDiscovery, storage and high availability options, helping make sure that customers’ IT infrastructure and mission-critical applications are protected, available and managed.
