Symantec Said to Seek Veritas Buyer Ahead of Planned Company Split
With Symantec (SYMC) insisting that its planned split into separate security and storage operations is still on track, rumors persist that for months the security vendor has pursued selling the Veritas business, or perhaps the entire company.
In the latest salvo, Reuters reported late last week that Symantec has approached storage providers EMC (EMC), NetApp (NTAP) and a number of private equity firms with trial balloons to test the market for a Veritas sale. Tax liabilities associated with splitting the company are said to be limiting the interest of potential buyers, according to the report.
JPMorgan Chase & Co, which advised Symantec on the corporate split, also has offered counsel on a possible sale of the entire company, sources told Reuters.
Symantec hasn’t directly denied the reports, issuing a standard email to SCMagazine.com that it is “on track to separate Veritas and Symantec into two independently traded companies by the end of the calendar year–-one focused on information management and one focused on security.”
In an investors note, Sterne Agee analyst Alex Kurtz downplayed the latest reports of EMC and NetApp as potential Veritas buyers, writing that both vendors “have had multiple opportunities to buy the business over the last few years. Strategically, we do not see a purchase of Veritas as a needed move for either vendor.”
A private equity firm is the more likely buyer, Kurtz said.
Some reports have placed Symantec’s asking price for Veritas at about $8 billion, a figure Kurtz described as a “steep investment” for about 40 percent of Symantec’s overall revenue. Symantec paid $13.5 billion for Veritas in 2004.
Symantec’s market cap stands at $16.25 billion as of April 15’s market close.
In January, Symantec resurrected the Veritas name for its spun-off information management business, sporting a new logo but saying it will rely on the original company’s brand recognition, history and reputation to help the new entity establish its own identity.
If Symantec holds together to go through with the separation, its Security business will include consumer and enterprise endpoint security; endpoint management; encryption; mobile; SSL certificates; user authentication; mail, web and data center security; data loss prevention; hosted security; and managed security services.
Its Veritas information management business will include backup and recovery, archiving, eDiscovery, storage management and information availability solutions.
