Broadcom is in advanced talks to buy Symantec's enterprise business, just weeks after earlier acquisition talks broke down between the two companies, it has been reported.
In a deal reminiscent of Intel's 2010 purchase of McAfee, the semiconductor giant was said to be poised to buy Symantec in its entirety earlier this summer. However, the security firm broke off negotiations when Broadcom wouldn't offer more than $28 per share, according to CNBC
It seems that communications channels weren't cut completely, though, with rumours arising this morning that a $10 billion purchase price had been agreed for Symantec's enterprise business.
According to Reuters and various other outlets, an announcement from Symantec confirming the deal could be forthcoming today, shortly before its Q1 2020 conference call at 10.00pm BST.
The fact that the value of this latest rumoured deal is only $5 billion less than Broadcom was prepared to offer for the security vendor as a whole is enlightening. Despite the enterprise business unit struggling, with revenue either flat or down over the past several quarters, the chip manufacturer clearly sees the greatest opportunity there, rather than in the consumer and antivirus software business.
Should this deal come through, it offers something of a ray of hope to Symantec. As well as offloading the weaker side of its business, it will also get a much-needed injection of cash.
In August 2018, the company announced it was cutting close to 1,000 jobs as part of a larger restructuring plan aimed at saving $115 million per year in costs. In May that same year, it was also forced to reveal an ongoing internal investigation into financial irregularities that led to restated financials. Subsequently, it saw a string of executive resignations, culminating in the abrupt departure of CEO Greg Clark in May 2019. He has still not been replaced at the time of publication.
