‘Norton Antivirus Software’ maker Symantec Corp will split into two publicly traded companies, one focused on security and the other storage and backup, potentially making itself more attractive to suitors. The move by Symantec, which has fired two CEOs since 2012 as its stock and financial performance lagged many other software makers, follows a trend of companies splitting in an effort to boost their share prices.
The deal also reverses its long troubled $13.5 billion acquisition a decade ago of storage software maker Veritas. Slowing PC sales have hurt its security sales, while sluggish demand for its storage and data management software has diminished the value of Veritas, which was seen as a “cash cow” when it was purchased. A number of potential buyers, including Cisco Systems Inc and NetApp Inc, are likely to show interest in the two surviving Symantec businesses, Piper Jaffray analyst Andrew Nowinski said in a note. Symantec’s revenue fell 3% to $6.7 billion in its most-recent fiscal year as its storage business struggled. That unit’s operating income dropped 19% to $574 million as revenue fell 4% to $2.5 billion, according to the company’s 10-K annual report.
The break-up comes during a banner year for spinoffs. More than 60 are expected to be completed this year, the most since 2000, according to Spin-Off Research.
Among the recently announced spinoffs, Hewlett-Packard is separating its PC and printer unit from its corporate hardware and services operations. Online auction company eBay Inc is spinning off its electronics payment service PayPal.