- Symantec splitting in two companies
- Will form Storage, Security Companies
- CEO, CFO to retain positions
The company is Splitting Into Two Publicly-Traded Companies
Something unusual is just happening in all these tech companies recently and maybe it has something to do with the atmosphere around Silicon Valley. First we heard of the infamous eBay and PayPal split up and then came the news that computer and printing giant Hewlett-Packard was going to be split into two and these two major splits happened a week within a week’s time. Now it was time for another company to drop the bomb and this time it is the antivirus maker Symantec which has announced that it is hopping onto this bandwagon too.
The company made an announcement on Thursday afternoon that it is going to split itself in two independent publicly-traded companies. One of the companies is going to focus on the security business and the other one is going to focus on information management. The company said that after “an extensive business review” of its strategy and structure it has decided that two different companies should be given birth to get two standalone businesses. According to the company, this is going to maximize growth and shareholder values.
The company that’s going to deal with the security business is going to focus entirely on cybersecurity services ranging from Norton antivirus software to encryption and user authentication products. While the other company is going to see to Symantec’s information management business which generated $2.5 billion in fiscal 2014 as opposed to the $4.2 billion in security services.
“As the security and storage industries continue to change at an accelerating pace, Symantec’s security and IM businesses each face unique market opportunities and challenges. It has become clear that winning in both security and information management requires distinct strategies, focused investments and go-to market innovation,” Michael Brown, Symantec’s newly appointed president and CEO, said in a statement Thursday afternooon. “Separating Symantec into two, independent publicly traded companies will provide each business the flexibility and focus to drive growth and enhance shareholder value.”
It is said that the shares of Symantec were halted in after-hours trading as the news of the split was released and from what we have gathered, this new structure should hardly be a surprise to Wall Street. According to reports from Bloomberg News the company was exploring a split but calls for a split have been happening for the past four years and up till April the analysts were still having dividing views on whether or not this split would help the shares.
Symantec has only released the news for the split and no other major details have been granted such as what these two companies are going to be called. So far we only know that this transaction is expected to be complete by December 2015 and that Michael Brown will remain the president and CEO of Symantec while Thomas Seifert will continue to serve as CFO.