Broadcom Buying Symantec’s Enterprise Business for $10.7 Billion

Broadcom has succeeded in its efforts to acquire Symantec, however, instead of the whole company, it’s purchasing the cybersecurity giant’s enterprise security business for $10.7 billion in cash.

Last month, Broadcom failed in its attempt to purchase Symantec for more than $15 billion. On Thursday, Broadcom said the addition of Symantec’s enterprise security portfolio will “significantly expand” its infrastructure software footprint as it continues to build “one of the world’s leading infrastructure technology companies.”

Broadcom’s Hock Tan

“M&A has played a central role in Broadcom’s growth strategy and this transaction represents the next logical step in our strategy following our acquisitions of Brocade and CA Technologies,” said Hock Tan, Broadcom’s president and CEO. “Symantec’s enterprise security business is recognized as an established leader in the growing enterprise security space and has developed some of the world’s most powerful defense solutions that protect against today’s evolving threat landscape and secure data from endpoint to cloud. We look forward to expanding our footprint of mission critical infrastructure software within our core Global 2000 customer base.”

Symantec didn’t comment on the acquisition.

Eric Parizo, senior analyst with Ovum, tells Channel Partners the acquisition will be a better deal than the original because Symantec’s enterprise unit has been growing while its consumer unit has been a turnaround project, “admittedly performing better recently.”

“But long term I’m doubtful that the combination of consumer endpoint security and identity protection can be a successful competitive differentiation in the marketplace,” he said.

For Symantec it would still be a “travesty,” Parizo said.

“From a technology standpoint this arrangement would be even worse than having all of Symantec getting acquired because presumably it would lose its consumer endpoint install base, which generates a ton of invaluable threat intelligence from which its enterprise customers benefit,” he said. “Plus other units like its lauded research group would have to be split as well.”

Essentially it would be all the same mistakes Symantec made from the Veritas deal repeated, plus more, and given the many years of trauma the vendor has already endured, Parizo said.

“I don’t think it’s an exaggeration to say an acquisition by Broadcom would prove to be the death knell for Symantec,” he said.